Earnings Beat: Jardine Cycle & Carriage Limited Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models
A week ago, Jardine Cycle & Carriage Limited (SGX:C07) came out with a strong set of full-year numbers that could potentially lead to a re-rate of the stock. It was overall a positive result, with revenues beating expectations by 4.8% to hit US$22b. Jardine Cycle & Carriage reported statutory earnings per share (EPS) US$3.08, which was a notable 17% above what the analysts had forecast. Following the result, the 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
View our latest analysis for Jardine Cycle & Carriage
Following the recent earnings report, the consensus from three analysts covering Jardine Cycle & Carriage is for revenues of US$21.7b in 2024. This implies a perceptible 2.6% decline in revenue compared to the last 12 months. Statutory earnings per share are expected to nosedive 21% to US$2.44 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$21.3b and earnings per share (EPS) of US$2.68 in 2024. The 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 numbers for next year.
The average price target fell 9.2% to S$26.17, with reduced earnings forecasts clearly tied to a lower valuation estimate. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Jardine Cycle & Carriage analyst has a price target of S$29.50 per share, while the most pessimistic values it at S$24.02. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Jardine Cycle & Carriage is an easy business to forecast or the the analysts are all using similar assumptions.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Jardine Cycle & Carriage's past performance and to peers in the same industry. We would highlight that revenue is expected to reverse, with a forecast 2.6% annualised decline to the end of 2024. That is a notable change from historical growth of 5.5% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 6.2% per year. It's pretty clear that Jardine Cycle & Carriage's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Jardine Cycle & Carriage's future valuation.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Jardine Cycle & Carriage going out to 2026, and you can see them free on our platform here..
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Jardine Cycle & Carriage (at least 1 which makes us a bit uncomfortable) , and understanding them should be part of your investment process.
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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.
