Last week, you might have seen that Azad Engineering Limited (NSE:AZAD) released its quarterly result to the market. The early response was not positive, with shares down 5.0% to ₹2,434 in the past week. Results were roughly in line with estimates, with revenues of ₹1.9b and statutory earnings per share of ₹4.79. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Following the latest results, Azad Engineering's six analysts are now forecasting revenues of ₹8.05b in 2027. This would be a solid 20% improvement in revenue compared to the last 12 months. Per-share earnings are expected to accumulate 6.0% to ₹22.50. In the lead-up to this report, the analysts had been modelling revenues of ₹8.05b and earnings per share (EPS) of ₹26.08 in 2027. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a substantial drop in EPS estimates.
See our latest analysis for Azad Engineering
The consensus price target held steady at ₹2,576, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Azad Engineering at ₹3,125 per share, while the most bearish prices it at ₹2,050. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting Azad Engineering's growth to accelerate, with the forecast 44% annualised growth to the end of 2027 ranking favourably alongside historical growth of 27% per annum over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 13% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Azad Engineering is expected to grow much faster than its industry.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. 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. The consensus price target held steady at ₹2,576, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on Azad Engineering. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Azad Engineering 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 Azad Engineering that you should be aware of.
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