Results: Alembic Pharmaceuticals Limited Beat Earnings Expectations And Analysts Now Have New Forecasts
Alembic Pharmaceuticals Limited (NSE:APLLTD) defied analyst predictions to release its quarterly results, which were ahead of market expectations. It was a solid earnings report, with revenues and statutory earnings per share (EPS) both coming in strong. Revenues were 12% higher than the analysts had forecast, at ₹26b, while EPS were ₹39.31 beating analyst models by 258%. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Alembic Pharmaceuticals after the latest results.
Taking into account the latest results, the most recent consensus for Alembic Pharmaceuticals from nine analysts is for revenues of ₹90.9b in 2027. If met, it would imply a reasonable 7.1% increase on its revenue over the past 12 months. Statutory earnings per share are forecast to sink 13% to ₹37.30 in the same period. Before this earnings report, the analysts had been forecasting revenues of ₹84.3b and earnings per share (EPS) of ₹37.30 in 2027. There doesn't appear to have been a major change in sentiment following the results, other than the small increase to revenue estimates.
See our latest analysis for Alembic Pharmaceuticals
Even though revenue forecasts increased, there was no change to the consensus price target of ₹978, suggesting the analysts are focused on earnings as the driver of value creation. 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 Alembic Pharmaceuticals analyst has a price target of ₹1,132 per share, while the most pessimistic values it at ₹835. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that Alembic Pharmaceuticals' rate of growth is expected to accelerate meaningfully, with the forecast 15% annualised revenue growth to the end of 2027 noticeably faster than its historical growth of 9.0% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 12% annually. Alembic Pharmaceuticals is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. They also upgraded their revenue forecasts, although the latest estimates suggest that Alembic Pharmaceuticals will grow in line with the overall 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 in mind, we wouldn't be too quick to come to a conclusion on Alembic Pharmaceuticals. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Alembic Pharmaceuticals analysts - going out to 2029, and you can see them free on our platform here.
Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Alembic Pharmaceuticals that you should be aware of.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.