Analysts Just Made A Huge Upgrade To Their APAC Realty Limited (SGX:CLN) Forecasts

APAC Realty Limited (SGX:CLN) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals.

Following the upgrade, the most recent consensus for APAC Realty from its four analysts is for revenues of S$432m in 2021 which, if met, would be a meaningful 10% increase on its sales over the past 12 months. Per-share earnings are expected to swell 15% to S$0.053. Before this latest update, the analysts had been forecasting revenues of S$368m and earnings per share (EPS) of S$0.041 in 2021. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.

See our latest analysis for APAC Realty

It will come as no surprise to learn that the analysts have increased their price target for APAC Realty 9.1% to S$0.52 on the back of these upgrades. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on APAC Realty, with the most bullish analyst valuing it at S$0.68 and the most bearish at S$0.36 per share. This shows there is still some diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting APAC Realty's growth to accelerate, with the forecast 10% annualised growth to the end of 2021 ranking favourably alongside historical growth of 5.5% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 11% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that APAC Realty is expected to grow at about the same rate as the wider industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at APAC Realty.

Better yet, our automated discounted cash flow calculation (DCF) suggests APAC Realty could be moderately undervalued. You can learn more about our valuation methodology on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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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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