Krishna Institute of Medical Sciences Limited Just Missed Earnings - But Analysts Have Updated Their Models
It's been a good week for Krishna Institute of Medical Sciences Limited (NSE:KIMS) shareholders, because the company has just released its latest quarterly results, and the shares gained 3.0% to ₹723. It was not a great result overall. Although revenues beat expectations, hitting ₹13b, statutory earnings missed analyst forecasts by 15%, coming in at just ₹1.79 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Following the latest results, Krishna Institute of Medical Sciences' 16 analysts are now forecasting revenues of ₹51.8b in 2027. This would be a notable 12% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to shoot up 81% to ₹9.62. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹51.8b and earnings per share (EPS) of ₹10.54 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 Krishna Institute of Medical Sciences
The consensus price target held steady at ₹866, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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 Krishna Institute of Medical Sciences, with the most bullish analyst valuing it at ₹1,000 and the most bearish at ₹680 per share. 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.
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 Krishna Institute of Medical Sciences' rate of growth is expected to accelerate meaningfully, with the forecast 26% annualised revenue growth to the end of 2027 noticeably faster than its historical growth of 21% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 18% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Krishna Institute of Medical Sciences is expected to grow much faster than its industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Krishna Institute of Medical Sciences. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than 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 in mind, we wouldn't be too quick to come to a conclusion on Krishna Institute of Medical Sciences. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Krishna Institute of Medical Sciences analysts - going out to 2029, and you can see them free on our platform here.
However, before you get too enthused, we've discovered 2 warning signs for Krishna Institute of Medical Sciences (1 is significant!) that you should be aware of.
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