The annual results for Sheng Siong Group Ltd (SGX:OV8) were released last week, making it a good time to revisit its performance. It looks like the results were a bit of a negative overall. While revenues of S$991m were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 3.8% to hit S$0.05 per share. This is an important time for investors, as they can track a company's performance in its report, look at what top analysts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the latest consensus from Sheng Siong Group's seven analysts is for revenues of S$1.08b in 2020, which would reflect a notable 9.2% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to expand 14% to S$0.057. In the lead-up to this report, analysts had been modelling revenues of S$1.07b and earnings per share (EPS) of S$0.058 in 2020. So it's pretty clear that, although analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
There were no changes to revenue or earnings estimates or the price target of S$1.31, suggesting that the company has met expectations in its recent result. The consensus price target just an average of individual analyst targets, so - considering that the price target changed, it would be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Sheng Siong Group at S$1.45 per share, while the most bearish prices it at S$1.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that Sheng Siong Group's rate of growth is expected to accelerate meaningfully, with forecast 9.2% revenue growth noticeably faster than its historical growth of 5.7%p.a. over the past five years. Compare this with other companies in the same market, which are forecast to grow their revenue 7.8% next year. Sheng Siong Group is expected to grow at about the same rate as its market, so it's not clear that we can draw any conclusions from its growth relative to competitors.
The Bottom Line
The most obvious conclusion from these results is that there's been no major change in the business' prospects in recent times, with analysts holding earnings per share steady, in line with previous estimates. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall market. The consensus price target held steady at S$1.31, with the latest estimates not enough to have an impact on analysts' estimated valuations.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Sheng Siong Group going out to 2022, and you can see them free on our platform here..
Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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.
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