Sime Darby Berhad's latest earnings exceeded market EPS expectations by 27%, prompting a share-price reaction. Analysts revised their revenue outlook for the next fiscal year and raised their target price.
Sime Darby Berhad's shareholders saw the share price rise following the latest earnings announcement, with the stock reaching 2.60 ringgit. Revenue came in slightly below expectations at 69.0 billion ringgit, but EPS was a strong 0.26 ringgit, 27% above forecast.
The latest analyst forecasts call for 2027 revenue of 71.2 billion ringgit and EPS of 0.23 ringgit. Compared with the previous forecasts of 72.1 billion ringgit in revenue and EPS of 0.21 ringgit, consensus has been revised slightly more optimistically.
Analysts raised their target price to 2.64 ringgit, with the most bullish view at 3.33 ringgit and the most bearish at 2.05 ringgit. Revenue is expected to grow at an annual rate of 2.5%, below the 13% average growth rate over the past 5 years.
In conclusion, the upward revision to EPS has strengthened the bullish view, while the importance of the long-term growth outlook has been highlighted. Expectations for growth above the overall industry remain, but analysts are taking a watchful stance on profitability from the next fiscal year onward and the longer-term outlook.