A week ago, AMTD International Inc. (NYSE:HKIB) came out with a strong set of quarterly numbers that could potentially lead to a re-rate of the stock. Statutory revenue and earnings both blasted past expectations, with revenue of HK$424m beating expectations by 82% and earnings per share (EPS) reaching HK$1.38, some 96% ahead of expectations. Following the result, analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether analysts have changed their earnings models, following these results.
Taking into account the latest results, the lone analyst covering AMTD International provided consensus estimates of HK$1.13b revenue in 2020, which would reflect a stressful 40% decline on its sales over the past 12 months. Statutory earnings per share are expected to plummet 20% to HK$3.04 in the same period. In the lead-up to this report, analysts had been modelling revenues of HK$1.13b and earnings per share (EPS) of HK$3.27 in 2020. Analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share forecasts for next year.
In addition, we can look to AMTD International's past performance and see whether business is expected to improve, and if the company is expected to perform better than wider market. We would highlight that sales are expected to reverse, with the forecast 40% revenue decline a notable change from historical growth of 140% over the last year. By contrast, our data suggests that other companies (with analyst coverage) in the same market are forecast to see their revenue grow 3.4% annually for the foreseeable future. It's pretty clear that AMTD International's revenues are expected to perform substantially worse than the wider market.
The Bottom Line
The biggest concern with the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds could lay ahead for AMTD International. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that AMTD International's revenues are expected to perform worse than the wider market. Analysts also began providing a price target, suggesting that the business has reached a point where analysts feel comfortable deriving a valuation for it.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for AMTD International going out as far as 2021, and you can see them free on our platform here.
We also provide an overview of the AMTD International Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.