Yahoo Finance Analysts Are Updating Their Singapore Telecommunications Limited (SGX:Z74) Estimates After Its Half-Year Results
It's been a good week for Singapore Telecommunications Limited (SGX:Z74) shareholders, because the company has just released its latest half-yearly results, and the shares gained 6.7% to S$2.69. The results were positive, with revenue coming in at S$7.3b, beating analyst expectations by 2.1%. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Check out our latest analysis for Singapore Telecommunications
Taking into account the latest results, the current consensus from Singapore Telecommunications' 17 analysts is for revenues of S$15.3b in 2023, which would reflect a credible 2.1% increase on its sales over the past 12 months. Statutory earnings per share are predicted to step up 11% to S$0.15. In the lead-up to this report, the analysts had been modelling revenues of S$15.4b and earnings per share (EPS) of S$0.15 in 2023. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
The analysts reconfirmed their price target of S$3.19, showing that the business is executing well and in line with expectations. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Singapore Telecommunications at S$4.40 per share, while the most bearish prices it at S$2.72. 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.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Singapore Telecommunications' past performance and to peers in the same industry. For example, we noticed that Singapore Telecommunications' rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 4.3% growth to the end of 2023 on an annualised basis. That is well above its historical decline of 3.2% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 3.6% per year. So it looks like Singapore Telecommunications is expected to grow at about the same rate as the wider industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as 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.
With that in mind, we wouldn't be too quick to come to a conclusion on Singapore Telecommunications. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Singapore Telecommunications analysts - going out to 2025, and you can see them free on our platform here.
It is also worth noting that we have found 1 warning sign for Singapore Telecommunications that you need to take into consideration.
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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.
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