It's been a good week for Wilmar International Limited (SGX:F34) shareholders, because the company has just released its latest annual results, and the shares gained 4.6% to S$3.39. It looks to have been a decent result overall - while revenue fell marginally short of analyst estimates at US$67b, statutory earnings beat expectations by a notable 15%, coming in at US$0.24 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts 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 most recent consensus for Wilmar International from 13 analysts is for revenues of US$71.0b in 2024. If met, it would imply an okay 5.7% increase on its revenue over the past 12 months. Per-share earnings are expected to ascend 12% to US$0.27. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$70.8b and earnings per share (EPS) of US$0.28 in 2024. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.
It might be a surprise to learn that the consensus price target was broadly unchanged at S$3.82, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Wilmar International analyst has a price target of S$4.62 per share, while the most pessimistic values it at S$2.31. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
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. It's pretty clear that there is an expectation that Wilmar International's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 5.7% growth on an annualised basis. This is compared to a historical growth rate of 13% 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) 2.2% per year. So it's pretty clear that, while Wilmar International's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Wilmar International. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Wilmar International going out to 2026, and you can see them free on our platform here.
Even so, be aware that Wilmar International is showing 3 warning signs in our investment analysis , and 1 of those is concerning...
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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.
