Celcomdigi Berhad Just Missed Earnings - But Analysts Have Updated Their Models

Celcomdigi Berhad (KLSE:CDB) came out with its annual results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. It was not a great result overall. While revenues of RM13b were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 13% to hit RM0.13 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Celcomdigi Berhad

Taking into account the latest results, the current consensus from Celcomdigi Berhad's 23 analysts is for revenues of RM13.2b in 2024. This would reflect a reasonable 3.8% increase on its revenue over the past 12 months. Per-share earnings are expected to leap 38% to RM0.18. In the lead-up to this report, the analysts had been modelling revenues of RM13.2b and earnings per share (EPS) of RM0.18 in 2024. So the consensus seems to have become somewhat more optimistic on Celcomdigi Berhad's earnings potential following these results.

There's been no major changes to the consensus price target of RM4.64, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. 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. The most optimistic Celcomdigi Berhad analyst has a price target of RM6.00 per share, while the most pessimistic values it at RM3.40. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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. We would highlight that Celcomdigi Berhad's revenue growth is expected to slow, with the forecast 3.8% annualised growth rate until the end of 2024 being well below the historical 11% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.4% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Celcomdigi Berhad.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Celcomdigi Berhad following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Celcomdigi Berhad's revenue is expected to perform worse than the wider industry. The consensus price target held steady at RM4.64, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Celcomdigi Berhad. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Celcomdigi Berhad analysts - going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 2 warning signs we've spotted with Celcomdigi Berhad .

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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.