Analysts Are Betting On Afrimat Limited (JSE:AFT) With A Big Upgrade This Week

Celebrations may be in order for Afrimat Limited (JSE:AFT) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The revenue forecast for this year has experienced a facelift, with analysts now much more optimistic on its sales pipeline. Investors have been pretty optimistic on Afrimat too, with the stock up 10% to R44.07 over the past week. It will be interesting to see if today's upgrade is enough to propel the stock even higher.

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Following the upgrade, the latest consensus from Afrimat's dual analysts is for revenues of R11b in 2026, which would reflect a solid 14% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to soar 146% to R2.65. Before this latest update, the analysts had been forecasting revenues of R9.4b and earnings per share (EPS) of R2.42 in 2026. Sentiment certainly seems to have improved in recent times, with a nice gain to revenue and a small lift in earnings per share estimates.

See our latest analysis for Afrimat

It will come as no surprise to learn that the analysts have increased their price target for Afrimat 9.4% to R52.50 on the back of these upgrades.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Afrimat's growth to accelerate, with the forecast 29% annualised growth to the end of 2026 ranking favourably alongside historical growth of 20% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 14% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Afrimat is expected to grow much faster than its 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. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. There was also an increase in the price target, suggesting that there is more optimism baked into the forecasts than there was previously. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Afrimat.

Analysts are clearly in love with Afrimat at the moment, but before diving in - you should be aware that we've identified some warning flags with the business, such as its declining profit margins. You can learn more, and discover the 1 other flag we've identified, for free 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 with high insider ownership.

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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.