It's been a pretty great week for Nazara Technologies Limited (NSE:NAZARA) shareholders, with its shares surging 15% to ₹349 in the week since its latest quarterly results. Revenues were ₹4.3b, 10% below analyst expectations, although losses didn't appear to worsen significantly, with a statutory per-share loss of ₹2.21 being in line with what the analysts anticipated. 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.
Following the latest results, Nazara Technologies' seven analysts are now forecasting revenues of ₹33.6b in 2027. This would be a substantial 91% improvement in revenue compared to the last 12 months. Nazara Technologies is also expected to turn profitable, with statutory earnings of ₹1.60 per share. In the lead-up to this report, the analysts had been modelling revenues of ₹35.3b and earnings per share (EPS) of ₹5.05 in 2027. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a large cut to earnings per share numbers.
View our latest analysis for Nazara Technologies
The average price target climbed 6.2% to ₹317despite the reduced earnings forecasts, suggesting that this earnings impact could be a positive for the stock, once it passes. 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 Nazara Technologies analyst has a price target of ₹410 per share, while the most pessimistic values it at ₹180. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Nazara Technologies' past performance and to peers in the same industry. The analysts are definitely expecting Nazara Technologies' growth to accelerate, with the forecast 137% annualised growth to the end of 2027 ranking favourably alongside historical growth of 25% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 7.7% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Nazara Technologies to grow faster than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Nazara Technologies. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will 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 estimates - from multiple Nazara Technologies analysts - going out to 2029, and you can see them free on our platform here.
You can also see our analysis of Nazara Technologies' Board and CEO remuneration and experience, and whether company insiders have been buying stock.
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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.