Earnings Miss: Here's What Inari Amertron Berhad (KLSE:INARI) Analysts Are Forecasting For This Year

Inari Amertron Berhad (KLSE:INARI) missed earnings with its latest second-quarter results, disappointing overly-optimistic forecasters. It looks like quite a negative result overall, with both revenues and earnings falling well short of analyst predictions. Revenues of RM349m missed by 17%, and statutory earnings per share of RM0.024 fell short of forecasts by 20%. 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 Inari Amertron Berhad after the latest results.

See our latest analysis for Inari Amertron Berhad

Taking into account the latest results, the most recent consensus for Inari Amertron Berhad from 21 analysts is for revenues of RM1.47b in 2025. If met, it would imply an okay 3.8% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to bounce 22% to RM0.078. Before this earnings report, the analysts had been forecasting revenues of RM1.63b and earnings per share (EPS) of RM0.092 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

The consensus price target fell 7.5% to RM3.01, with the weaker earnings outlook clearly leading valuation estimates. 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 Inari Amertron Berhad analyst has a price target of RM4.21 per share, while the most pessimistic values it at RM2.20. 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.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Inari Amertron Berhad's growth to accelerate, with the forecast 7.8% annualised growth to the end of 2025 ranking favourably alongside historical growth of 4.9% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 13% annually. So it's clear that despite the acceleration in growth, Inari Amertron Berhad is expected to grow meaningfully slower than the industry average.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Inari Amertron Berhad. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Inari Amertron Berhad analysts - 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 Inari Amertron 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.