Results: Malaysia Smelting Corporation Berhad Beat Earnings Expectations And Analysts Now Have New Forecasts

Simply Wall St
February 22, 2022
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The investors in Malaysia Smelting Corporation Berhad's (KLSE:MSC) will be rubbing their hands together with glee today, after the share price leapt 21% to RM4.69 in the week following its yearly results. The results were mixed; although revenues of RM1.1b fell 17% short of what the analysts had predicted, per-share (statutory) earnings of RM0.28 beat expectations by 33%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Malaysia Smelting Corporation Berhad after the latest results.

See our latest analysis for Malaysia Smelting Corporation Berhad

KLSE:MSC Earnings and Revenue Growth February 22nd 2022

Following the latest results, Malaysia Smelting Corporation Berhad's twin analysts are now forecasting revenues of RM2.12b in 2022. This would be a substantial 96% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to jump 55% to RM0.44. Yet prior to the latest earnings, the analysts had been anticipated revenues of RM1.60b and earnings per share (EPS) of RM0.36 in 2022. So we can see there's been a pretty clear increase in sentiment following the latest results, with both revenues and earnings per share receiving a decent lift in the latest estimates.

With these upgrades, we're not surprised to see that the analysts have lifted their price target 10% to RM3.39per share.

Of course, another way to look at these forecasts is to place them into context against the industry itself. One thing stands out from these estimates, which is that Malaysia Smelting Corporation Berhad is forecast to grow faster in the future than it has in the past, with revenues expected to display 96% annualised growth until the end of 2022. If achieved, this would be a much better result than the 12% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 9.5% per year. So it looks like Malaysia Smelting Corporation Berhad is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Malaysia Smelting Corporation Berhad following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

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 analyst estimates for Malaysia Smelting Corporation Berhad going out as far as 2024, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 3 warning signs for Malaysia Smelting Corporation Berhad (1 shouldn't be ignored) you should be aware of.

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