Do you own Allkem Ltd (ASX: AKE) shares? If you do, you will no doubt be crossing your fingers that the lithium miner delivers a strong result this month.
But what would be strong? Letâs take a look to see what the market is expecting from Allkem when it reports its results on 18 August.
Allkem FY 2023 results preview
According to a note out of Goldman Sachs, its analysts are expecting Allkem to deliver revenue of US$1,211 million. This represents a 57.3% increase on FY 2022âs revenue of US$770 million.
And with the broker forecasting a 4 basis point increase in its underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) margin to 73%, this will underpin even stronger earnings growth.
Goldman has pencilled in underlying EBITDA growth of 67.2% to US$888 million.
And on the very bottom line, the broker is expecting underlying earnings to come in at US$436 million or 68.3 cents per share.
Will there be a dividend?
Although Goldman is expecting Allkem to report free cash flow of US$228 million, it isnât expecting this to lead to any dividends being paid, unfortunately.
In fact, as things stand, the broker doesnât believe a dividend will be paid until FY 2027. Though, its proposed merger with Livent Corp (NYSE: LTHM) will have been completed long before then if all goes to plan.
Are Allkem shares a buy?
Goldman continues to see a lot of value in Allkem shares at the current level.
Its analysts have a buy rating and a $17.10 price target, which implies a potential upside of greater than 17% for investors over the next 12 months.
Stay tuned for its result next week.
