Industry Analysts Just Upgraded Their Media Prima Berhad (KLSE:MEDIA) Revenue Forecasts By 13%

Shareholders in Media Prima Berhad (KLSE:MEDIA) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects.

Following the upgrade, the latest consensus from Media Prima Berhad's six analysts is for revenues of RM1.5b in 2023, which would reflect a sizeable 46% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to ascend 17% to RM0.054. Before this latest update, the analysts had been forecasting revenues of RM1.3b and earnings per share (EPS) of RM0.054 in 2023. It seems analyst sentiment has certainly become more bullish on revenues, even though they haven't changed their view on earnings per share.

See our latest analysis for Media Prima Berhad

As a result, it might come as a surprise that the consensus price target has been cut 6.3% to RM0.46, which could suggest that these earnings are considered less valuable by the market than previously. 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 Media Prima Berhad at RM0.60 per share, while the most bearish prices it at RM0.34. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. For example, we noticed that Media Prima Berhad's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 112% growth to the end of 2023 on an annualised basis. That is well above its historical decline of 2.8% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 11% annually. So it looks like Media Prima Berhad is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The most obvious conclusion from this consensus update is that there's been no major change in the business' prospects in recent times, with analysts holding earnings per share steady, in line with previous estimates. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. The consensus price target fell measurably, with analysts seemingly not reassured by recent business developments, leading to a lower estimate of Media Prima Berhad's future valuation. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Media Prima Berhad.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Media Prima Berhad going out to 2025, and you can see them 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 upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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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.