Saudi Kayan Petrochemical Company (TADAWUL:2350) investors will be delighted, with the company turning in some strong numbers with its latest results. Saudi Kayan Petrochemical outperformed estimates, with revenues of ر.س2.2b beating estimates by 14%. Statutory losses were ر.س0.06, 86% smaller thanthe analysts expected. 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 collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the most recent consensus for Saudi Kayan Petrochemical from seven analysts is for revenues of ر.س9.06b in 2027. If met, it would imply a credible 6.7% increase on its revenue over the past 12 months. Losses are predicted to fall substantially, shrinking 55% to ر.س0.61. Before this latest report, the consensus had been expecting revenues of ر.س9.27b and ر.س0.66 per share in losses. It looks like there's been a modest increase in sentiment in the recent updates, with the analysts becoming a bit more optimistic in their predictions for losses per share, even though the revenue numbers fell somewhat.
View our latest analysis for Saudi Kayan Petrochemical
The consensus price target was broadly unchanged at ر.س5.57, implying that the business is performing roughly in line with expectations, despite adjustments to both revenue and earnings estimates. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Saudi Kayan Petrochemical analyst has a price target of ر.س8.20 per share, while the most pessimistic values it at ر.س4.60. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. One thing stands out from these estimates, which is that Saudi Kayan Petrochemical is forecast to grow faster in the future than it has in the past, with revenues expected to display 5.3% annualised growth until the end of 2027. If achieved, this would be a much better result than the 10% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 4.6% annually. So while Saudi Kayan Petrochemical's revenues are expected to improve, it seems that it is expected to grow at about the same rate as the overall industry.
The Bottom Line
The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. They also downgraded their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. Still, earnings are more important to the intrinsic value of the business. 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. We have forecasts for Saudi Kayan Petrochemical going out to 2028, and you can see them free on our platform here.
Before you take the next step you should know about the 1 warning sign for Saudi Kayan Petrochemical that we have uncovered.
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