Yahoo Finance IHS Holding Limited (NYSE:IHS) Just Released Its First-Quarter Results And Analysts Are Updating Their Estimates
A week ago, IHS Holding Limited (NYSE:IHS) came out with a strong set of first-quarter numbers that could potentially lead to a re-rate of the stock. Results were good overall, with revenues beating analyst predictions by 3.6% to hit US$446m. Statutory earnings per share (EPS) came in at US$0.05, some 4.4% above whatthe analysts had 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'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 IHS Holding
Taking into account the latest results, the most recent consensus for IHS Holding from six analysts is for revenues of US$1.90b in 2022 which, if met, would be a notable 14% increase on its sales over the past 12 months. Per-share earnings are expected to jump 161% to US$0.17. Before this earnings report, the analysts had been forecasting revenues of US$1.85b and earnings per share (EPS) of US$0.18 in 2022. So it's pretty clear consensus is mixed on IHS Holding after the latest results; whilethe analysts lifted revenue numbers, they also administered a small dip in per-share earnings expectations.
There's been no major changes to the price target of US$20.29, suggesting that the impact of higher forecast sales and lower earnings won't result in a meaningful change to the business' valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic IHS Holding analyst has a price target of US$26.00 per share, while the most pessimistic values it at US$16.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the IHS Holding's past performance and to peers in the same industry. It's clear from the latest estimates that IHS Holding's rate of growth is expected to accelerate meaningfully, with the forecast 19% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 10.0% p.a. 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 1.6% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that IHS Holding is expected to grow much faster than its industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for IHS Holding. Happily, they also upgraded their revenue estimates, and are forecasting revenues 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. At Simply Wall St, we have a full range of analyst estimates for IHS Holding going out to 2024, and you can see them free on our platform here..
It is also worth noting that we have found 2 warning signs for IHS Holding (1 is a bit concerning!) that you need to take into consideration.
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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.
