Urban Company Limited (NSE:URBANCO) Second-Quarter Results: Here's What Analysts Are Forecasting For This Year

Urban Company Limited (NSE:URBANCO) shareholders are probably feeling a little disappointed, since its shares fell 3.3% to ₹158 in the week after its latest quarterly results. Revenues of ₹5.4b beat expectations by a respectable 3.7%, although statutory losses per share increased. Urban lost ₹1.20, which was 31% more than what the analysts had included in their models. 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. 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 eight analysts covering Urban are now predicting revenues of ₹21.9b in 2027. If met, this would reflect a decent 17% improvement in revenue compared to the last 12 months. Per-share losses are expected to explode, reaching ₹3.68 per share. Before this latest report, the consensus had been expecting revenues of ₹21.4b and ₹2.57 per share in losses. So it's pretty clear the analysts have mixed opinions on Urban even after this update; although they upped their revenue numbers, it came at the cost of a massive increase in per-share losses.

View our latest analysis for Urban

The consensus price target stayed unchanged at ₹152, seeming to suggest that higher forecast losses are not expected to have a long term impact on the valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Urban analyst has a price target of ₹200 per share, while the most pessimistic values it at ₹96.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The period to the end of 2027 brings more of the same, according to the analysts, with revenue forecast to display 36% growth on an annualised basis. That is in line with its 41% annual growth over the past year. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 20% annually. So it's pretty clear that Urban is forecast to grow substantially faster than its industry.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Urban. Happily, they also upgraded their revenue estimates, and are forecasting them 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 said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Urban going out to 2029, and you can see them free on our platform here.

You can also see our analysis of Urban's 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.