Ethos Limited Just Missed EPS By 30%: Here's What Analysts Think Will Happen Next

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Ethos Limited (NSE:ETHOSLTD) shareholders are probably feeling a little disappointed, since its shares fell 4.6% to ₹2,649 in the week after its latest quarterly results. Statutory earnings per share fell badly short of expectations, coming in at ₹7.77, some 30% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at ₹3.5b. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

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After the latest results, the two analysts covering Ethos are now predicting revenues of ₹15.8b in 2026. If met, this would reflect a meaningful 19% improvement in revenue compared to the last 12 months. Per-share earnings are expected to soar 35% to ₹46.80. Before this earnings report, the analysts had been forecasting revenues of ₹15.7b and earnings per share (EPS) of ₹52.70 in 2026. So there's definitely been a decline in sentiment after the latest results, noting the substantial drop in new EPS forecasts.

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It might be a surprise to learn that the consensus price target fell 7.1% to ₹3,250, with the analysts clearly linking lower forecast earnings to the performance of the stock price.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We can infer from the latest estimates that forecasts expect a continuation of Ethos'historical trends, as the 26% annualised revenue growth to the end of 2026 is roughly in line with the 23% annual growth over the past three years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 19% annually. So although Ethos is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Ethos. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for Ethos going out as far as 2028, and you can see them free on our platform here.

You can also view our analysis of Ethos' balance sheet, and whether we think Ethos is carrying too much debt, for free on our platform here.

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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.