Frontage Holdings Corporation (HKG:1521) just released its latest full-year report and things are not looking great. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at US$255m, statutory earnings missed forecasts by an incredible 93%, coming in at just US$0.0004 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the current consensus from Frontage Holdings' twin analysts is for revenues of US$278.7m in 2025. This would reflect a decent 9.3% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to surge 808% to US$0.0036. Before this earnings report, the analysts had been forecasting revenues of US$306.8m and earnings per share (EPS) of US$0.007 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a large cut to earnings per share numbers.
Check out our latest analysis for Frontage Holdings
The analysts made no major changes to their price target of HK$1.12, suggesting the downgrades are not expected to have a long-term impact on Frontage Holdings' valuation.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that Frontage Holdings' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 9.3% growth on an annualised basis. This is compared to a historical growth rate of 19% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 19% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Frontage Holdings.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Frontage Holdings. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse 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.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.
And what about risks? Every company has them, and we've spotted 1 warning sign for Frontage Holdings you should know about.
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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.