ViTrox Corporation Berhad Just Missed Earnings - But Analysts Have Updated Their Models

It's shaping up to be a tough period for ViTrox Corporation Berhad (KLSE:VITROX), which a week ago released some disappointing quarterly results that could have a notable impact on how the market views the stock. ViTrox Corporation Berhad delivered a grave earnings miss, with both revenues (RM137m) and statutory earnings per share (RM0.015) falling badly short of analyst expectations. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for ViTrox Corporation Berhad

Taking into account the latest results, the current consensus from ViTrox Corporation Berhad's twelve analysts is for revenues of RM607.3m in 2024. This would reflect a decent 12% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to ascend 16% to RM0.063. In the lead-up to this report, the analysts had been modelling revenues of RM667.3m and earnings per share (EPS) of RM0.085 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a pretty serious reduction to earnings per share numbers.

The analysts made no major changes to their price target of RM3.95, suggesting the downgrades are not expected to have a long-term impact on ViTrox Corporation Berhad's valuation. 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. There are some variant perceptions on ViTrox Corporation Berhad, with the most bullish analyst valuing it at RM5.15 and the most bearish at RM2.92 per share. 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.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analysts are definitely expecting ViTrox Corporation Berhad's growth to accelerate, with the forecast 24% annualised growth to the end of 2024 ranking favourably alongside historical growth of 12% 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 14% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect ViTrox Corporation Berhad to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for ViTrox Corporation Berhad going out to 2026, and you can see them free on our platform here..

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com