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Celebrations may be in order for Yinson Holdings Berhad (KLSE:YINSON) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The analysts have sharply increased their revenue numbers, with a view that Yinson Holdings Berhad will make substantially more sales than they'd previously expected.
Following the upgrade, the current consensus from Yinson Holdings Berhad's eight analysts is for revenues of RM7.2b in 2024 which - if met - would reflect a solid 13% increase on its sales over the past 12 months. Statutory earnings per share are presumed to jump 67% to RM0.26. Prior to this update, the analysts had been forecasting revenues of RM5.5b and earnings per share (EPS) of RM0.24 in 2024. The forecasts seem more optimistic now, with a great increase in revenue and a slight bump in earnings per share estimates.
View our latest analysis for Yinson Holdings Berhad
Although the analysts have upgraded their earnings estimates, there was no change to the consensus price target of RM3.78, suggesting that the forecast performance does not have a long term impact on the company's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Yinson Holdings Berhad at RM5.05 per share, while the most bearish prices it at RM3.12. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Yinson Holdings Berhad's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 13% growth on an annualised basis. This is compared to a historical growth rate of 35% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 0.7% per year. So it's pretty clear that, while Yinson Holdings Berhad's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.
The Bottom Line
The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Yinson Holdings Berhad.