Syarikat Takaful Malaysia Keluarga Berhad (KLSE:TAKAFUL) Just Beat EPS By 9.4%: Here's What Analysts Are Forecasting For This Year

Syarikat Takaful Malaysia Keluarga Berhad (KLSE:TAKAFUL) just released its latest annual results and things are looking bullish. Syarikat Takaful Malaysia Keluarga Berhad beat revenue and statutory earnings per share (EPS) expectations, with sales hitting RM2.6b (11% ahead of estimates) and EPS reaching RM0.44 (a 9.4% 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Syarikat Takaful Malaysia Keluarga Berhad

Taking into account the latest results, the current consensus, from the six analysts covering Syarikat Takaful Malaysia Keluarga Berhad, is for revenues of RM2.21b in 2021, which would reflect an uncomfortable 14% reduction in Syarikat Takaful Malaysia Keluarga Berhad's sales over the past 12 months. Per-share earnings are expected to increase 9.8% to RM0.44. In the lead-up to this report, the analysts had been modelling revenues of RM2.42b and earnings per share (EPS) of RM0.42 in 2021. So it's pretty clear that while sentiment around revenues has declined following the latest results, the analysts are now more bullish on the company's earnings power.

The consensus has made no major changes to the price target of RM5.33, suggesting the forecast improvement in earnings is expected to offset the decline in revenues next year. 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 Syarikat Takaful Malaysia Keluarga Berhad at RM5.80 per share, while the most bearish prices it at RM4.82. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

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 14% revenue decline a notable change from historical growth of 13% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 2.1% annually for the foreseeable future. It's pretty clear that Syarikat Takaful Malaysia Keluarga 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 Syarikat Takaful Malaysia Keluarga Berhad's earnings potential next year. Unfortunately, they also downgraded their revenue estimates, and our data indicates revenues are expected to perform worse than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Yet - earnings are more important to the intrinsic value of the business. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Syarikat Takaful Malaysia Keluarga Berhad. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Syarikat Takaful Malaysia Keluarga Berhad analysts - going out to 2023, and you can see them free on our platform here.

Before you take the next step you should know about the 1 warning sign for Syarikat Takaful Malaysia Keluarga Berhad that we have uncovered.

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