Halwani Bros. Co. Ltd. Beat Analyst Estimates: See What The Consensus Is Forecasting For This Year

Halwani Bros. Co. Ltd. (TADAWUL:6001) last week reported its latest annual results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Revenues were ر.س1.1b, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at ر.س3.21, an impressive 55% ahead of estimates. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Halwani Bros

Taking into account the latest results, the current consensus from Halwani Bros' twin analysts is for revenues of ر.س1.08b in 2021, which would reflect a satisfactory 2.1% increase on its sales over the past 12 months. Statutory earnings per share are expected to decline 12% to ر.س2.83 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of ر.س1.13b and earnings per share (EPS) of ر.س3.02 in 2021. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the small dip in earnings per share expectations.

What's most unexpected is that the consensus price target rose 29% to ر.س71.00, strongly implying the downgrade to forecasts is not expected to be more than a temporary blip.

Of course, another way to look at these forecasts is to place them into context against the industry itself. One thing stands out from these estimates, which is that Halwani Bros is forecast to grow faster in the future than it has in the past, with revenues expected to display 2.1% annualised growth until the end of 2021. If achieved, this would be a much better result than the 0.9% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 5.0% annually for the foreseeable future. So although Halwani Bros' revenue growth is expected to improve, it is still expected to grow slower than the industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Halwani Bros. Unfortunately, they also downgraded their revenue estimates, and our data indicates revenues are expected to perform worse than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2025, which can be seen for free on our platform here.

Even so, be aware that Halwani Bros is showing 1 warning sign in our investment analysis , you should know about...

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This article by Simply Wall St is general in nature. 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.
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