Sterling and Wilson Renewable Energy Limited (NSE:SWSOLAR) Consensus Forecasts Have Become A Little Darker Since Its Latest Report

It's been a good week for Sterling and Wilson Renewable Energy Limited (NSE:SWSOLAR) shareholders, because the company has just released its latest second-quarter results, and the shares gained 2.1% to ₹165. The result was fairly weak overall, with revenues of ₹15b being 9.0% less than what the analysts had been modelling. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

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After the latest results, the twin analysts covering Sterling and Wilson Renewable Energy are now predicting revenues of ₹80.5b in 2027. If met, this would reflect a meaningful 13% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to step up 14% to ₹10.05. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹85.3b and earnings per share (EPS) of ₹12.20 in 2027. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a substantial drop in earnings per share estimates.

View our latest analysis for Sterling and Wilson Renewable Energy

It'll come as no surprise then, to learn that the analysts have cut their price target 24% to ₹221.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Sterling and Wilson Renewable Energy's growth to accelerate, with the forecast 27% annualised growth to the end of 2027 ranking favourably alongside historical growth of 16% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 13% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Sterling and Wilson Renewable Energy to grow faster than the wider 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. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At least one analyst has provided forecasts out to 2029, which can be seen for free on our platform here.

Even so, be aware that Sterling and Wilson Renewable Energy is showing 1 warning sign in our investment analysis , you should know about...

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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.