Revenue Beat: Sahara International Petrochemical Company Beat Analyst Estimates By 7.2%

The first-quarter results for Sahara International Petrochemical Company (TADAWUL:2310) were released last week, making it a good time to revisit its performance. It was a workmanlike result, with revenues of ر.س1.9b coming in 7.2% ahead of expectations, and statutory earnings per share of ر.س0.25, in line with analyst appraisals. 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.

View our latest analysis for Sahara International Petrochemical

Taking into account the latest results, the current consensus from Sahara International Petrochemical's eight analysts is for revenues of ر.س7.61b in 2024. This would reflect a credible 2.0% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to soar 54% to ر.س1.89. Yet prior to the latest earnings, the analysts had been anticipated revenues of ر.س7.60b and earnings per share (EPS) of ر.س1.95 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at ر.س38.77, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Sahara International Petrochemical at ر.س45.10 per share, while the most bearish prices it at ر.س31.50. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Sahara International Petrochemical's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 2.7% growth on an annualised basis. This is compared to a historical growth rate of 13% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 5.2% annually. Factoring in the forecast slowdown in growth, it seems obvious that Sahara International Petrochemical is also expected to grow slower than other industry participants.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Sahara International Petrochemical. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Sahara International Petrochemical going out to 2026, and you can see them free on our platform here..

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Sahara International Petrochemical (1 can't be ignored) 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.