KEC International Limited Just Missed EPS By 13%: Here's What Analysts Think Will Happen Next
KEC International Limited (NSE:KEC) shareholders are probably feeling a little disappointed, since its shares fell 7.1% to ₹442 in the week after its latest first-quarter results. It was not a great result overall. While revenues of ₹50b were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 13% to hit ₹2.73 per share. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Taking into account the latest results, the most recent consensus for KEC International from 25 analysts is for revenues of ₹260.7b in 2027. If met, it would imply a meaningful 11% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 26% to ₹26.16. In the lead-up to this report, the analysts had been modelling revenues of ₹263.3b and earnings per share (EPS) of ₹28.63 in 2027. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.
See our latest analysis for KEC International
The average price target fell 5.6% to ₹550, with reduced earnings forecasts clearly tied to a lower valuation estimate. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values KEC International at ₹648 per share, while the most bearish prices it at ₹411. 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.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the KEC International's past performance and to peers in the same industry. We can infer from the latest estimates that forecasts expect a continuation of KEC International'shistorical trends, as the 15% annualised revenue growth to the end of 2027 is roughly in line with the 13% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 13% annually. So although KEC International is expected to maintain its revenue growth rate, it's only growing at about the rate of 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. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of KEC International's future valuation.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple KEC International analysts - going out to 2029, and you can see them free on our platform here.
You still need to take note of risks, for example - KEC International has 2 warning signs (and 1 which doesn't sit too well with us) we think you should know about.
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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.