As you might know, Skellerup Holdings Limited (NZSE:SKL) just kicked off its latest yearly results with some very strong numbers. Results were good overall, with revenues beating analyst predictions by 2.9% to hit NZ$280m. Statutory earnings per share (EPS) came in at NZ$0.21, some 5.7% above whatthe analysts had expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
After the latest results, the dual analysts covering Skellerup Holdings are now predicting revenues of NZ$303.6m in 2022. If met, this would reflect a decent 8.6% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to expand 14% to NZ$0.24. Yet prior to the latest earnings, the analysts had been anticipated revenues of NZ$290.3m and earnings per share (EPS) of NZ$0.22 in 2022. It looks like there's been a modest increase in sentiment following the latest results, withthe analysts becoming a bit more optimistic in their predictions for both revenues and earnings.
With these upgrades, we're not surprised to see that the analysts have lifted their price target 20% to NZ$5.80per share.
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. It's clear from the latest estimates that Skellerup Holdings' rate of growth is expected to accelerate meaningfully, with the forecast 8.6% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 5.8% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 19% annually. So it's clear that despite the acceleration in growth, Skellerup Holdings is expected to grow meaningfully slower than the industry average.
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 Skellerup Holdings following these results. They also upgraded their revenue estimates for next year, even though sales are expected to grow slower than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
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 least one analyst has provided forecasts out to 2024, which can be seen for free on our platform here.
Even so, be aware that Skellerup Holdings is showing 1 warning sign in our investment analysis , you should know about...
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