Grand Venture Technology Limited (SGX:JLB) Just Reported, And Analysts Assigned A S$1.07 Price Target

Grand Venture Technology Limited (SGX:JLB) came out with its interim results last week, and we wanted to see how the business is performing and what industry forecasts think of the company following this report. Grand Venture Technology reported in line with analyst predictions, delivering revenues of S$67m and statutory earnings per share of S$0.059, suggesting the business is executing well and in line with its plan. Earnings are an important time for investors, as they can track a company's performance, look at what the analyst is forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analyst has changed their earnings models, following these results.

See our latest analysis for Grand Venture Technology

After the latest results, the lone analyst covering Grand Venture Technology are now predicting revenues of S$141.0m in 2022. If met, this would reflect a decent 8.6% improvement in sales compared to the last 12 months. Statutory per-share earnings are expected to be S$0.048, roughly flat on the last 12 months. Yet prior to the latest earnings, the analyst had been anticipated revenues of S$148.3m and earnings per share (EPS) of S$0.063 in 2022. The analyst seem less optimistic after the recent results, reducing their sales forecasts and making a pretty serious reduction to earnings per share numbers.

It'll come as no surprise then, to learn that the analyst has cut their price target 20% to S$1.07.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Grand Venture Technology's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Grand Venture Technology's revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 18% growth on an annualised basis. This is compared to a historical growth rate of 46% over the past three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 10.0% annually. So it's pretty clear that, while Grand Venture Technology's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The biggest concern is that the analyst reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Grand Venture Technology. They also downgraded their revenue estimates, although industry data suggests that Grand Venture Technology's revenues are expected to grow faster than the wider industry. The consensus price target fell measurably, with the analyst seemingly not reassured by the latest results, leading to a lower estimate of Grand Venture Technology's future valuation.

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 2023, which can be seen for free on our platform here.

You still need to take note of risks, for example - Grand Venture Technology has 2 warning signs (and 1 which makes us a bit uncomfortable) we think 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.