This Broker Just Slashed Their Hiap Teck Venture Berhad (KLSE:HIAPTEK) Earnings Forecasts

The analyst covering Hiap Teck Venture Berhad (KLSE:HIAPTEK) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analyst seeing grey clouds on the horizon.

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Following the latest downgrade, Hiap Teck Venture Berhad's one analyst currently expects revenues in 2025 to be RM1.5b, approximately in line with the last 12 months. Statutory earnings per share are supposed to tumble 49% to RM0.04 in the same period. Before this latest update, the analyst had been forecasting revenues of RM1.7b and earnings per share (EPS) of RM0.048 in 2025. It looks like analyst sentiment has declined substantially, with a measurable cut to revenue estimates and a considerable drop in earnings per share numbers as well.

View our latest analysis for Hiap Teck Venture Berhad

The analyst made no major changes to their price target of RM0.37, suggesting the downgrades are not expected to have a long-term impact on Hiap Teck Venture Berhad's valuation.

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 a forecast 1.4% annualised revenue decline to the end of 2025. That is a notable change from historical growth of 12% 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 3.4% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Hiap Teck Venture Berhad is expected to lag the wider industry.

The Bottom Line

The biggest issue in the new estimates is that the analyst has reduced their earnings per share estimates, suggesting business headwinds lay ahead for Hiap Teck Venture Berhad. Unfortunately the analyst also downgraded their revenue estimates, and industry data suggests that Hiap Teck Venture Berhad's revenues are expected to grow slower than the wider market. We're also surprised to see that the price target went unchanged. Still, deteriorating business conditions (assuming accurate forecasts!) can be a leading indicator for the stock price, so we wouldn't blame investors for being more cautious on Hiap Teck Venture Berhad after the downgrade.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At least one analyst has provided forecasts out to 2027, which can be seen for free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.