Results: ACME Solar Holdings Limited Beat Earnings Expectations And Analysts Now Have New Forecasts
Investors in ACME Solar Holdings Limited (NSE:ACMESOLAR) had a good week, as its shares rose 8.9% to close at ₹405 following the release of its second-quarter results. It looks like a credible result overall - although revenues of ₹8.9b were what the analysts expected, ACME Solar Holdings surprised by delivering a (statutory) profit of ₹3.75 per share, an impressive 36% above what was forecast. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the most recent consensus for ACME Solar Holdings from 14 analysts is for revenues of ₹41.3b in 2027. If met, it would imply a major 48% increase on its revenue over the past 12 months. Per-share earnings are expected to bounce 33% to ₹14.22. In the lead-up to this report, the analysts had been modelling revenues of ₹39.4b and earnings per share (EPS) of ₹12.42 in 2027. So it seems there's been a definite increase in optimism about ACME Solar Holdings' future following the latest results, with a nice increase in the earnings per share forecasts in particular.
See our latest analysis for ACME Solar Holdings
With these upgrades, we're not surprised to see that the analysts have lifted their price target 5.9% to ₹479per share. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on ACME Solar Holdings, with the most bullish analyst valuing it at ₹560 and the most bearish at ₹422 per share. This is a very narrow spread of estimates, implying either that ACME Solar Holdings is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's clear from the latest estimates that ACME Solar Holdings' rate of growth is expected to accelerate meaningfully, with the forecast 119% annualised revenue growth to the end of 2027 noticeably faster than its historical growth of 54% over the past year. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 16% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect ACME Solar Holdings to grow faster than the wider industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around ACME Solar Holdings' earnings potential next year. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for ACME Solar Holdings going out to 2029, and you can see them free on our platform here.
You should always think about risks though. Case in point, we've spotted 3 warning signs for ACME Solar Holdings you should be aware of, and 2 of them are potentially serious.
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