It's been a good week for Frontage Holdings Corporation (HKG:1521) shareholders, because the company has just released its latest interim results, and the shares gained 5.0% to HK$2.52. It looks like a pretty bad result, all things considered. Although revenues of US$119m were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 39% to hit US$0.0061 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Frontage Holdings

Following the latest results, Frontage Holdings' seven analysts are now forecasting revenues of US$258.7m in 2022. This would be a solid 19% improvement in sales compared to the last 12 months. Statutory per share are forecast to be US$0.011, approximately in line with the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of US$249.1m and earnings per share (EPS) of US$0.012 in 2022. Overall it looks as though the analysts were a bit mixed on the latest results. Although there was a a solid to revenue, the consensus also made a minor downgrade to its earnings per share forecasts.

The consensus price target was unchanged at HK$4.55, suggesting the business is performing roughly in line with expectations, despite some adjustments to profit and revenue forecasts. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Frontage Holdings analyst has a price target of HK$6.50 per share, while the most pessimistic values it at HK$3.30. 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.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Frontage Holdings' past performance and to peers in the same industry. The analysts are definitely expecting Frontage Holdings' growth to accelerate, with the forecast 40% annualised growth to the end of 2022 ranking favourably alongside historical growth of 31% per annum over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 21% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Frontage Holdings is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster 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.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Frontage Holdings analysts - going out to 2024, and you can see them free on our platform here.

We also provide an overview of the Frontage Holdings Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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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.