Results: Saudi Arabian Mining Company (Ma'aden) Beat Earnings Expectations And Analysts Now Have New Forecasts

Investors in Saudi Arabian Mining Company (Ma'aden) (TADAWUL:1211) had a good week, as its shares rose 3.3% to close at ر.س41.20 following the release of its second-quarter results. Revenues of ر.س7.2b fell slightly short of expectations, but earnings were a definite bright spot, with statutory per-share profits of ر.س0.28 an impressive 82% ahead of estimates. 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.

Check out our latest analysis for Saudi Arabian Mining Company (Ma'aden)

Taking into account the latest results, the most recent consensus for Saudi Arabian Mining Company (Ma'aden) from eight analysts is for revenues of ر.س30.4b in 2024. If met, it would imply a reasonable 5.5% increase on its revenue over the past 12 months. Per-share earnings are expected to jump 42% to ر.س1.08. In the lead-up to this report, the analysts had been modelling revenues of ر.س30.5b and earnings per share (EPS) of ر.س0.87 in 2024. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the sizeable expansion in earnings per share expectations following these results.

There's been no major changes to the consensus price target of ر.س36.94, 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 Saudi Arabian Mining Company (Ma'aden) analyst has a price target of ر.س45.00 per share, while the most pessimistic values it at ر.س31.50. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Saudi Arabian Mining Company (Ma'aden) shareholders.

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 pretty clear that there is an expectation that Saudi Arabian Mining Company (Ma'aden)'s revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 11% growth on an annualised basis. This is compared to a historical growth rate of 16% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 9.0% per year. So it's pretty clear that, while Saudi Arabian Mining Company (Ma'aden)'s revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

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 Saudi Arabian Mining Company (Ma'aden) following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at ر.س36.94, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Saudi Arabian Mining Company (Ma'aden) analysts - going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for Saudi Arabian Mining Company (Ma'aden) that you should be aware of.

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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.