Yatra Online Limited (NSE:YATRA) Analysts Just Cut Their EPS Forecasts Substantially
The analysts covering Yatra Online Limited (NSE:YATRA) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Both revenue and earnings per share (EPS) estimates were cut sharply as the analysts factored in the latest outlook for the business, concluding that they were too optimistic previously. At ₹114, shares are up 9.0% in the past 7 days. Investors could be forgiven for changing their mind on the business following the downgrade; but it's not clear if the revised forecasts will lead to selling activity.
After this downgrade, Yatra Online's five analysts are now forecasting revenues of ₹11b in 2027. This would be a notable 9.2% improvement in sales compared to the last 12 months. Per-share earnings are expected to bounce 101% to ₹4.00. Before this latest update, the analysts had been forecasting revenues of ₹12b and earnings per share (EPS) of ₹5.03 in 2027. Indeed, we can see that the analysts are a lot more bearish about Yatra Online's prospects, administering a substantial drop in revenue estimates and slashing their EPS estimates to boot.
See our latest analysis for Yatra Online
The average price target climbed 5.5% to ₹173 despite the reduced earnings forecasts, suggesting that this earnings impact could be a positive for the stock, once it passes.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Yatra Online's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Yatra Online's revenue growth will slow down substantially, with revenues to the end of 2027 expected to display 12% growth on an annualised basis. This is compared to a historical growth rate of 37% over the past three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 18% per year. Factoring in the forecast slowdown in growth, it seems obvious that Yatra Online is also expected to grow slower than other industry participants.
The Bottom Line
The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Yatra Online. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Yatra Online's revenues are expected to grow slower than the wider market. The rising price target is a puzzle, but still - with a serious cut to this year's outlook, we wouldn't be surprised if investors were a bit wary of Yatra Online.
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 Yatra Online analysts - going out to 2029, and you can see them free on our platform here.
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.
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