Analysts Have Been Trimming Their Mr D.I.Y. Group (M) Berhad (KLSE:MRDIY) Price Target After Its Latest Report

It's shaping up to be a tough period for Mr D.I.Y. Group (M) Berhad (KLSE:MRDIY), which a week ago released some disappointing annual results that could have a notable impact on how the market views the stock. Mr D.I.Y. Group (M) Berhad missed analyst forecasts, with revenues of RM4.7b and statutory earnings per share (EPS) of RM0.06, falling short by 4.1% and 4.0% respectively. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Mr D.I.Y. Group (M) Berhad

Taking into account the latest results, the current consensus from Mr D.I.Y. Group (M) Berhad's 15 analysts is for revenues of RM5.32b in 2025. This would reflect a notable 14% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to grow 17% to RM0.07. Before this earnings report, the analysts had been forecasting revenues of RM5.58b and earnings per share (EPS) of RM0.075 in 2025. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the minor downgrade to earnings per share expectations.

The consensus price target fell 14% to RM1.97, with the weaker earnings outlook clearly leading valuation estimates. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Mr D.I.Y. Group (M) Berhad, with the most bullish analyst valuing it at RM2.60 and the most bearish at RM1.25 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

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 period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 14% growth on an annualised basis. That is in line with its 15% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 8.7% annually. So although Mr D.I.Y. Group (M) Berhad is expected to maintain its revenue growth rate, it's definitely expected 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 Mr D.I.Y. Group (M) Berhad. They also downgraded Mr D.I.Y. Group (M) Berhad's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Mr D.I.Y. Group (M) Berhad's future valuation.

With that in mind, we wouldn't be too quick to come to a conclusion on Mr D.I.Y. Group (M) Berhad. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Mr D.I.Y. Group (M) Berhad going out to 2027, and you can see them free on our platform here..

We don't want to rain on the parade too much, but we did also find 1 warning sign for Mr D.I.Y. Group (M) Berhad that you need to be mindful of.

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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.