Budweiser Brewing Company APAC Limited (HKG:1876) last week reported its latest quarterly results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. The result was positive overall - although revenues of US$1.6b were in line with what the analysts predicted, Budweiser Brewing Company APAC surprised by delivering a statutory profit of US$0.022 per share, modestly greater than expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
After the latest results, the 30 analysts covering Budweiser Brewing Company APAC are now predicting revenues of US$7.14b in 2024. If met, this would reflect a reasonable 5.1% improvement in revenue compared to the last 12 months. Per-share earnings are expected to soar 24% to US$0.079. Before this earnings report, the analysts had been forecasting revenues of US$7.26b and earnings per share (EPS) of US$0.08 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at HK$16.41. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Budweiser Brewing Company APAC analyst has a price target of HK$26.66 per share, while the most pessimistic values it at HK$11.00. We would probably assign less value to the analyst forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the 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. The analysts are definitely expecting Budweiser Brewing Company APAC's growth to accelerate, with the forecast 6.8% annualised growth to the end of 2024 ranking favourably alongside historical growth of 1.7% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 9.5% per year. It seems obvious that, while the future growth outlook is brighter than the recent past, Budweiser Brewing Company APAC is expected to grow slower than the wider industry.
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, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Budweiser Brewing Company APAC's revenue is expected to perform worse than the wider industry. The consensus price target held steady at HK$16.41, with the latest estimates not enough to have an impact on their price targets.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Budweiser Brewing Company APAC going out to 2026, and you can see them free on our platform here.
And what about risks? Every company has them, and we've spotted 1 warning sign for Budweiser Brewing Company APAC you should know about.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.