Scientex Berhad Just Recorded A 7.4% Revenue Beat: Here's What Analysts Think

Scientex Berhad (KLSE:SCIENTX) came out with its first-quarter results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Results overall were respectable, with statutory earnings of RM0.28 per share roughly in line with what the analysts had forecast. Revenues of RM1.1b came in 7.4% ahead of analyst predictions. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Scientex Berhad

Taking into account the latest results, the current consensus from Scientex Berhad's seven analysts is for revenues of RM4.51b in 2024. This would reflect a reasonable 3.0% increase on its revenue over the past 12 months. Per-share earnings are expected to rise 4.8% to RM0.35. Before this earnings report, the analysts had been forecasting revenues of RM4.54b and earnings per share (EPS) of RM0.36 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The consensus price target rose 8.3% to RM4.51despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Scientex Berhad's earnings by assigning a price premium. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Scientex Berhad analyst has a price target of RM5.41 per share, while the most pessimistic values it at RM4.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Scientex Berhad's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 4.1% growth on an annualised basis. This is compared to a historical growth rate of 6.0% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.6% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Scientex Berhad.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Scientex Berhad's revenue is expected to perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that in mind, we wouldn't be too quick to come to a conclusion on Scientex Berhad. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Scientex Berhad analysts - going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with Scientex Berhad .

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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.

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