Godrej Agrovet Limited Just Missed Earnings - But Analysts Have Updated Their Models
Godrej Agrovet Limited (NSE:GODREJAGRO) shareholders are probably feeling a little disappointed, since its shares fell 2.5% to ₹543 in the week after its latest first-quarter results. It looks like the results were a bit of a negative overall. While revenues of ₹29b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 9.2% to hit ₹6.99 per share. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the consensus forecast from Godrej Agrovet's five analysts is for revenues of ₹112.8b in 2027. This reflects a reasonable 7.7% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to ascend 17% to ₹27.20. Before this earnings report, the analysts had been forecasting revenues of ₹112.4b and earnings per share (EPS) of ₹28.60 in 2027. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.
Check out our latest analysis for Godrej Agrovet
It might be a surprise to learn that the consensus price target was broadly unchanged at ₹777, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Godrej Agrovet analyst has a price target of ₹900 per share, while the most pessimistic values it at ₹645. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Godrej Agrovet's rate of growth is expected to accelerate meaningfully, with the forecast 10% annualised revenue growth to the end of 2027 noticeably faster than its historical growth of 5.7% p.a. over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 10% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Godrej Agrovet is expected to grow at about the same rate as the wider industry.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as 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 Godrej Agrovet going out to 2029, and you can see them free on our platform here..
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with Godrej Agrovet , and understanding this should be part of your investment process.
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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.