Latest news with #RM2.3b
Yahoo
21-04-2025
- Business
- Yahoo
Is V.S. Industry Berhad's (KLSE:VS) Stock Price Struggling As A Result Of Its Mixed Financials?
With its stock down 29% over the past three months, it is easy to disregard V.S. Industry Berhad (KLSE:VS). It is possible that the markets have ignored the company's differing financials and decided to lean-in to the negative sentiment. Fundamentals usually dictate market outcomes so it makes sense to study the company's financials. In this article, we decided to focus on V.S. Industry Berhad's ROE. Return on Equity or ROE is a test of how effectively a company is growing its value and managing investors' money. In short, ROE shows the profit each dollar generates with respect to its shareholder investments. We've discovered 2 warning signs about V.S. Industry Berhad. View them for free. The formula for return on equity is: Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity So, based on the above formula, the ROE for V.S. Industry Berhad is: 7.7% = RM174m ÷ RM2.3b (Based on the trailing twelve months to January 2025). The 'return' refers to a company's earnings over the last year. One way to conceptualize this is that for each MYR1 of shareholders' capital it has, the company made MYR0.08 in profit. View our latest analysis for V.S. Industry Berhad So far, we've learned that ROE is a measure of a company's profitability. Based on how much of its profits the company chooses to reinvest or "retain", we are then able to evaluate a company's future ability to generate profits. Generally speaking, other things being equal, firms with a high return on equity and profit retention, have a higher growth rate than firms that don't share these attributes. At first glance, V.S. Industry Berhad's ROE doesn't look very promising. Next, when compared to the average industry ROE of 10%, the company's ROE leaves us feeling even less enthusiastic. Thus, the low net income growth of 3.3% seen by V.S. Industry Berhad over the past five years could probably be the result of the low ROE. Next, on comparing with the industry net income growth, we found that V.S. Industry Berhad's reported growth was lower than the industry growth of 13% over the last few years, which is not something we like to see. The basis for attaching value to a company is, to a great extent, tied to its earnings growth. What investors need to determine next is if the expected earnings growth, or the lack of it, is already built into the share price. Doing so will help them establish if the stock's future looks promising or ominous. What is VS worth today? The intrinsic value infographic in our free research report helps visualize whether VS is currently mispriced by the market. Despite having a normal three-year median payout ratio of 44% (or a retention ratio of 56% over the past three years, V.S. Industry Berhad has seen very little growth in earnings as we saw above. So there could be some other explanation in that regard. For instance, the company's business may be deteriorating. In addition, V.S. Industry Berhad has been paying dividends over a period of at least ten years suggesting that keeping up dividend payments is way more important to the management even if it comes at the cost of business growth. Our latest analyst data shows that the future payout ratio of the company over the next three years is expected to be approximately 49%. Still, forecasts suggest that V.S. Industry Berhad's future ROE will rise to 14% even though the the company's payout ratio is not expected to change by much. Overall, we have mixed feelings about V.S. Industry Berhad. While the company does have a high rate of profit retention, its low rate of return is probably hampering its earnings growth. Having said that, looking at the current analyst estimates, we found that the company's earnings are expected to gain momentum. To know more about the company's future earnings growth forecasts take a look at this free report on analyst forecasts for the company to find out more. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) 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.
Yahoo
22-02-2025
- Business
- Yahoo
There's Been No Shortage Of Growth Recently For DKSH Holdings (Malaysia) Berhad's (KLSE:DKSH) Returns On Capital
Did you know there are some financial metrics that can provide clues of a potential multi-bagger? Typically, we'll want to notice a trend of growing return on capital employed (ROCE) and alongside that, an expanding base of capital employed. Ultimately, this demonstrates that it's a business that is reinvesting profits at increasing rates of return. So on that note, DKSH Holdings (Malaysia) Berhad (KLSE:DKSH) looks quite promising in regards to its trends of return on capital. If you haven't worked with ROCE before, it measures the 'return' (pre-tax profit) a company generates from capital employed in its business. To calculate this metric for DKSH Holdings (Malaysia) Berhad, this is the formula: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.18 = RM195m ÷ (RM3.4b - RM2.3b) (Based on the trailing twelve months to September 2024). Therefore, DKSH Holdings (Malaysia) Berhad has an ROCE of 18%. On its own, that's a standard return, however it's much better than the 7.1% generated by the Trade Distributors industry. See our latest analysis for DKSH Holdings (Malaysia) Berhad In the above chart we have measured DKSH Holdings (Malaysia) Berhad's prior ROCE against its prior performance, but the future is arguably more important. If you'd like, you can check out the forecasts from the analysts covering DKSH Holdings (Malaysia) Berhad for free. DKSH Holdings (Malaysia) Berhad's ROCE growth is quite impressive. The figures show that over the last five years, ROCE has grown 148% whilst employing roughly the same amount of capital. So it's likely that the business is now reaping the full benefits of its past investments, since the capital employed hasn't changed considerably. The company is doing well in that sense, and it's worth investigating what the management team has planned for long term growth prospects. On a side note, we noticed that the improvement in ROCE appears to be partly fueled by an increase in current liabilities. Essentially the business now has suppliers or short-term creditors funding about 69% of its operations, which isn't ideal. And with current liabilities at those levels, that's pretty high. In summary, we're delighted to see that DKSH Holdings (Malaysia) Berhad has been able to increase efficiencies and earn higher rates of return on the same amount of capital. Since the stock has returned a staggering 104% to shareholders over the last five years, it looks like investors are recognizing these changes. With that being said, we still think the promising fundamentals mean the company deserves some further due diligence. Like most companies, DKSH Holdings (Malaysia) Berhad does come with some risks, and we've found 2 warning signs that you should be aware of. While DKSH Holdings (Malaysia) Berhad isn't earning the highest return, check out this free list of companies that are earning high returns on equity with solid balance sheets. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) 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. Sign in to access your portfolio
Yahoo
09-02-2025
- Business
- Yahoo
British American Tobacco (Malaysia) Berhad Just Beat EPS By 9.6%: Here's What Analysts Think Will Happen Next
As you might know, British American Tobacco (Malaysia) Berhad (KLSE:BAT) just kicked off its latest yearly results with some very strong numbers. Results were good overall, with revenues beating analyst predictions by 4.9% to hit RM2.3b. Statutory earnings per share (EPS) came in at RM0.64, some 9.6% above whatthe analysts had expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year. View our latest analysis for British American Tobacco (Malaysia) Berhad Taking into account the latest results, the five analysts covering British American Tobacco (Malaysia) Berhad provided consensus estimates of RM2.16b revenue in 2025, which would reflect a perceptible 6.9% decline over the past 12 months. Statutory earnings per share are expected to sink 14% to RM0.55 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of RM2.17b and earnings per share (EPS) of RM0.57 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts. It might be a surprise to learn that the consensus price target was broadly unchanged at RM7.38, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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. The most optimistic British American Tobacco (Malaysia) Berhad analyst has a price target of RM9.77 per share, while the most pessimistic values it at RM5.20. 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. We would highlight that revenue is expected to reverse, with a forecast 6.9% annualised decline to the end of 2025. That is a notable change from historical growth of 5.5% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 6.5% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - British American Tobacco (Malaysia) Berhad is expected to lag the wider industry. 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. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at RM7.38, with the latest estimates not enough to have an impact on their price targets. 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 British American Tobacco (Malaysia) Berhad going out to 2027, and you can see them free on our platform here. Even so, be aware that British American Tobacco (Malaysia) Berhad is showing 4 warning signs in our investment analysis , and 1 of those can't be ignored... Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) 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. Sign in to access your portfolio
