KLCC Property Holdings Berhad Just Missed EPS By 32%: Here's What Analysts Think Will Happen Next

KLCC Property Holdings Berhad (KLSE:KLCC) last week reported its latest annual results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. It looks like a pretty bad result, all things considered. Although revenues of RM1.3b were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 32% to hit RM0.24 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on KLCC Property Holdings Berhad after the latest results.

See our latest analysis for KLCC Property Holdings Berhad

Taking into account the latest results, the most recent consensus for KLCC Property Holdings Berhad from nine analysts is for revenues of RM1.35b in 2021 which, if met, would be a reasonable 7.6% increase on its sales over the past 12 months. Statutory earnings per share are predicted to shoot up 53% to RM0.37. Yet prior to the latest earnings, the analysts had been anticipated revenues of RM1.39b and earnings per share (EPS) of RM0.39 in 2021. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the small dip in earnings per share expectations.

The analysts made no major changes to their price target of RM7.67, suggesting the downgrades are not expected to have a long-term impact on KLCC Property Holdings Berhad's valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic KLCC Property Holdings Berhad analyst has a price target of RM8.55 per share, while the most pessimistic values it at RM7.25. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting KLCC Property Holdings Berhad's growth to accelerate, with the forecast 7.6% growth ranking favourably alongside historical growth of 0.2% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 5.9% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect KLCC Property Holdings Berhad to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for KLCC Property Holdings Berhad. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. The consensus price target held steady at RM7.67, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for KLCC Property Holdings Berhad going out to 2024, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 3 warning signs for KLCC Property Holdings Berhad that you should be aware of.

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This article by Simply Wall St is general in nature. 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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