The quarterly results for Nazara Technologies Limited (NSE:NAZARA) were released last week, making it a good time to revisit its performance. Results overall were respectable, with statutory earnings of ₹0.95 per share roughly in line with what the analysts had forecast. Revenues of ₹8.0b came in 8.7% ahead of analyst predictions. 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 Nazara Technologies after the latest results.
Taking into account the latest results, the current consensus from Nazara Technologies' nine analysts is for revenues of ₹32.4b in 2027. This would reflect a substantial 270% increase on its revenue over the past 12 months. Per-share earnings are expected to shoot up 908% to ₹3.25. Before this earnings report, the analysts had been forecasting revenues of ₹31.8b and earnings per share (EPS) of ₹4.30 in 2027. So there's definitely been a decline in sentiment after the latest results, noting the pretty serious reduction to new EPS forecasts.
Check out our latest analysis for Nazara Technologies
Despite cutting their earnings forecasts,the analysts have lifted their price target 5.7% to ₹415, suggesting that these impacts are not expected to weigh on the stock's value in the long term. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Nazara Technologies, with the most bullish analyst valuing it at ₹720 and the most bearish at ₹300 per share. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.
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. The analysts are definitely expecting Nazara Technologies' growth to accelerate, with the forecast 13x annualised growth to the end of 2027 ranking favourably alongside historical growth of 20% 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 21% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Nazara Technologies 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 Nazara Technologies. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue 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.
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 Nazara Technologies analysts - going out to 2029, and you can see them free on our platform here.
Before you take the next step you should know about the 2 warning signs for Nazara Technologies that we have uncovered.
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