It's shaping up to be a tough period for Sun Hung Kai Properties Limited (HKG:16), which a week ago released some disappointing yearly results that could have a notable impact on how the market views the stock. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at HK$72b, statutory earnings missed forecasts by 17%, coming in at just HK$6.57 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
View our latest analysis for Sun Hung Kai Properties
Taking into account the latest results, the current consensus from Sun Hung Kai Properties' 14 analysts is for revenues of HK$78.3b in 2025. This would reflect a decent 9.5% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to climb 20% to HK$8.33. Before this earnings report, the analysts had been forecasting revenues of HK$77.3b and earnings per share (EPS) of HK$8.32 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at HK$92.68. 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 Sun Hung Kai Properties at HK$116 per share, while the most bearish prices it at HK$70.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Sun Hung Kai Properties shareholders.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Sun Hung Kai Properties' past performance and to peers in the same industry. One thing stands out from these estimates, which is that Sun Hung Kai Properties is forecast to grow faster in the future than it has in the past, with revenues expected to display 9.5% annualised growth until the end of 2025. If achieved, this would be a much better result than the 5.4% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 4.6% per year. So it looks like Sun Hung Kai Properties is expected to grow faster than its competitors, at least for a while.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at HK$92.68, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on Sun Hung Kai Properties. Long-term earnings power is much more important than next year's profits. We have forecasts for Sun Hung Kai Properties going out to 2027, and you can see them free on our platform here.
We don't want to rain on the parade too much, but we did also find 1 warning sign for Sun Hung Kai Properties that you need to be mindful of.
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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.