Analysts have continued to lift their forward-12 month estimates for Asian companies, Refinitiv data showed, thanks to a surge in commodity prices and an accelerating growth in the region’s exports and manufacturing output in February.
Analysts upgraded forward 12-month profit estimates for the region’s firms by 0.6% over the past month, data from Refinitiv showed.
They have raised their 2021 earnings forecasts by 2.3% since the start of this year.
Vietnam and Australia saw biggest earnings upgrades of 4% each in the past month, bolstered by their strong economic growth in the fourth quarter last year.
Vietnam appears likely to be a relative beneficiary of the post-COVID-19 imperative for global supply chain diversification, brokerage Jefferies said in a report.
While soaring commodity prices pushed earnings expectations on Australian firms higher, surging demand for electronic products - with people staying at home - helped the outlook for the region’s leading exporters such as Taiwan.
Taiwanese firms saw their earnings expectations raised by 2.5%, while Chinese companies witnessed upgrades of 0.2% in the past month, with its exports growing at a record pace in February.
Meanwhile, analysts also lifted Indian firms’ earnings growth as its economy returned to growth after two quarters of contraction.
In Indonesia, Philippines and Hong Kong, companies witnessed small earnings downgrades in the past month, the data showed.
“Hong Kong could see unfavourable earnings revisions on continued sluggish property market rental index and a further decline in retail sales of 14% yoy,” said Goldman Sachs in a report.