27-05-2025
One HeveaBoard Berhad (KLSE:HEVEA) Analyst Has Been Cutting Their Forecasts
Market forces rained on the parade of HeveaBoard Berhad (KLSE:HEVEA) shareholders today, when the covering analyst downgraded their forecasts for this year. Revenue estimates were cut sharply as the analyst signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.
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Following this downgrade, HeveaBoard Berhad's single analyst are forecasting 2025 revenues to be RM321m, approximately in line with the last 12 months. Previously, the analyst had been modelling revenues of RM432m and earnings per share (EPS) of RM0.003 in 2025. Indeed, we can see that the analyst is a lot more bearish about HeveaBoard Berhad's prospects, administering a pretty serious reduction to revenue estimates and slashing their EPS estimates to boot.
Check out our latest analysis for HeveaBoard Berhad
Notably, the analyst has cut their price target 8.3% to RM0.22, suggesting concerns around HeveaBoard Berhad's valuation.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's also worth noting that the years of declining sales look to have come to an end, with the forecast for flat revenues to the end of 2025. Historically, HeveaBoard Berhad's sales have shrunk approximately 5.6% annually 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 13% annually. Although HeveaBoard Berhad's revenues are expected to improve, it seems that it is still expected to grow slower than the wider industry.
The biggest issue in the new estimates is that the analyst has reduced their earnings per share estimates, suggesting business headwinds lay ahead for HeveaBoard Berhad. Unfortunately the analyst also downgraded their revenue estimates, and industry data suggests that HeveaBoard Berhad's revenues are expected to grow slower than the wider market. The consensus price target fell measurably, with the analyst seemingly not reassured by recent business developments, leading to a lower estimate of HeveaBoard Berhad's future valuation. Given the stark change in sentiment, we'd understand if investors became more cautious on HeveaBoard Berhad after today.
That said, this analyst might have good reason to be negative on HeveaBoard Berhad, given the risk of cutting its dividend. Learn more, and discover the 1 other risk we've identified, for free on our platform here.
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