Singapore Telecommunications Limited (SGX:Z74) has just released its latest annual report and things are not going so well. Singapore Telecommunications missed out on profits this time around, with revenue of S$16 billion down 2.1% from what analysts had modeled. Statutory earnings per share (EPS) of $0.12 was also below expectations of 11%. Following the result, analysts have updated their earnings model, and it would be good to know if they think there has been a strong change in the company’s outlook, or if business is as it is. habit. We thought readers would find it interesting to see analysts’ latest post-earnings (statutory) forecasts for next year.
Check out our latest analysis for Singapore Telecommunications
Given the latest results, the current consensus of Singapore Telecommunications’ 16 analysts is for revenues of S$16.1 billion in 2023, which would reflect a reasonable 3.8% increase in sales over the past 12 months. . Statutory earnings per share are expected to jump 97% to S$0.14. Looking ahead to this report, analysts had modeled revenue of S$16.2 billion and earnings per share (EPS) of S$0.16 in 2023. Analysts seem to have turned a bit more negative on the company after the latest results, given the slight decline in their earnings per share for the next year.
The consensus price target held steady at S$3.15, with analysts apparently voting that their lower earnings outlook should not drive the stock price lower for the foreseeable future. This is not the only conclusion we can draw from this data, however, as some investors also like to consider the discrepancy in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Singapore Telecommunications at S$4.40 per share, while the most bearish one values it at S$2.70. These price targets show that analysts have differing opinions on the company, but the estimates don’t vary enough to suggest to us that some are betting on wild success or total failure.
Another way to view these estimates is in the context of the big picture, such as how the forecast compares to past performance, and whether the forecast is more or less optimistic compared to other companies in the industry. One thing that emerges from these estimates is that Singapore Telecommunications is expected to grow faster in the future than in the past, with revenues expected to show annualized growth of 3.8% through the end of 2023. If that is achieved, this would be a much better result than the 2.3% annual decline recorded over the past five years. In contrast, our data suggests that other companies (with analyst coverage) in a similar industry should see revenue growth of 3.5% annually. So it looks like Singapore Telecommunications is set to grow at roughly the same rate as the industry as a whole.
The biggest concern is that analysts have cut their earnings per share estimates, suggesting headwinds could be in store for Singapore Telecommunications. They also reconfirmed their revenue estimates, with the company expected to grow at roughly the same rate as the overall industry. The consensus price target held steady at S$3.15 as the latest estimates were not enough to impact their price targets.
Continuing this thinking, we believe that the company’s long-term outlook is much more relevant than next year’s results. At Simply Wall St, we have a full range of analyst estimates for Singapore Telecommunications through 2025, and you can view them for free on our platform here.
However, you should always think about the risks. Concrete example, we spotted 2 Singapore telecommunications warning signs you should be aware.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.