Gas Malaysia Berhad Just Beat EPS By 6.5%: Here's What Analysts Think Will Happen Next

Gas Malaysia Berhad (KLSE:GASMSIA) last week reported its latest yearly results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. The result was positive overall - although revenues of RM8.1b were in line with what the analysts predicted, Gas Malaysia Berhad surprised by delivering a statutory profit of RM0.30 per share, modestly greater than expected. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for Gas Malaysia Berhad

Taking into account the latest results, Gas Malaysia Berhad's nine analysts currently expect revenues in 2024 to be RM7.92b, approximately in line with the last 12 months. Statutory earnings per share are forecast to descend 13% to RM0.26 in the same period. In the lead-up to this report, the analysts had been modelling revenues of RM7.59b and earnings per share (EPS) of RM0.27 in 2024. So it's pretty clear consensus is mixed on Gas Malaysia Berhad after the latest results; whilethe analysts lifted revenue numbers, they also administered a small dip in per-share earnings expectations.

The consensus price target was unchanged at RM3.36, suggesting the business is performing roughly in line with expectations, despite some adjustments to profit and revenue forecasts. 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 Gas Malaysia Berhad, with the most bullish analyst valuing it at RM3.80 and the most bearish at RM3.07 per share. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Gas Malaysia Berhad is an easy business to forecast or the the analysts are all using similar assumptions.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Gas Malaysia Berhad's past performance and to peers in the same industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 1.9% by the end of 2024. This indicates a significant reduction from annual growth of 5.0% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 3.3% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Gas Malaysia Berhad is expected to lag 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. They also upgraded their revenue estimates for next year, even though it is expected to grow slower than the wider industry. The consensus price target held steady at RM3.36, with the latest estimates not enough to have an impact on their price targets.

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. We have estimates - from multiple Gas Malaysia Berhad analysts - going out to 2026, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for Gas Malaysia Berhad (of which 1 is potentially serious!) you should know about.

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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.