Allianz Malaysia Berhad Just Beat Revenue Estimates By 18%

Allianz Malaysia Berhad (KLSE:ALLIANZ) just released its latest yearly results and things are looking bullish. Allianz Malaysia Berhad beat revenue and statutory earnings per share (EPS) expectations, with sales hitting RM5.5b (18% ahead of estimates) and EPS reaching RM1.50 (a 4.1% beat). The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Allianz Malaysia Berhad

Taking into account the latest results, the current consensus, from the five analysts covering Allianz Malaysia Berhad, is for revenues of RM5.07b in 2021, which would reflect a small 7.4% reduction in Allianz Malaysia Berhad's sales over the past 12 months. Statutory earnings per share are forecast to plummet 29% to RM1.50 in the same period. In the lead-up to this report, the analysts had been modelling revenues of RM4.90b and earnings per share (EPS) of RM1.42 in 2021. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.

Despite these upgrades,the analysts have not made any major changes to their price target of RM17.32, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Allianz Malaysia Berhad at RM18.20 per share, while the most bearish prices it at RM16.40. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Allianz Malaysia Berhad is an easy business to forecast or the the analysts are all using similar assumptions.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that sales are expected to reverse, with the forecast 7.4% revenue decline a notable change from historical growth of 5.9% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 2.1% next year. It's pretty clear that Allianz Malaysia Berhad's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Allianz Malaysia Berhad's earnings potential next year. Fortunately, they also upgraded their revenue estimates, although our data indicates sales are expected to perform worse than the wider industry. The consensus price target held steady at RM17.32, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Allianz Malaysia Berhad analysts - going out to 2023, and you can see them free on our platform here.

Plus, you should also learn about the 2 warning signs we've spotted with Allianz Malaysia Berhad (including 1 which is significant) .

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