Revenue Beat: The First Milling Company Beat Analyst Estimates By 12%
It's been a pretty great week for The First Milling Company (TADAWUL:2283) shareholders, with its shares surging 13% to ر.س55.95 in the week since its latest quarterly results. It was a mildly positive result, with revenues exceeding expectations at ر.س346m, while statutory earnings per share (EPS) of ر.س4.99 were in line with analyst forecasts. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on First Milling after the latest results.
After the latest results, the dual analysts covering First Milling are now predicting revenues of ر.س1.36b in 2027. If met, this would reflect a credible 3.1% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to accumulate 5.0% to ر.س5.78. Before this earnings report, the analysts had been forecasting revenues of ر.س1.31b and earnings per share (EPS) of ر.س5.47 in 2027. It looks like there's been a modest increase in sentiment following the latest results, withthe analysts becoming a bit more optimistic in their predictions for both revenues and earnings.
View our latest analysis for First Milling
Despite these upgrades, the consensus price target fell 6.2% to ر.س60.00, perhaps signalling that the uplift in performance is not expected to last.
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. It's pretty clear that there is an expectation that First Milling's revenue growth will slow down substantially, with revenues to the end of 2027 expected to display 2.5% growth on an annualised basis. This is compared to a historical growth rate of 8.7% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.3% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than First Milling.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around First Milling's earnings potential next year. Fortunately, they also upgraded their revenue estimates, although our data indicates it is expected to perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of First Milling's future valuation.
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. At least one analyst has provided forecasts out to 2028, which can be seen for free on our platform here.
And what about risks? Every company has them, and we've spotted 2 warning signs for First Milling you should know about.
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