BSE Limited (NSE:BSE) Beat Earnings, And Analysts Have Been Reviewing Their Forecasts
As you might know, BSE Limited (NSE:BSE) just kicked off its latest first-quarter results with some very strong numbers. The company beat expectations with revenues of ₹17b arriving 7.5% ahead of forecasts. Statutory earnings per share (EPS) were ₹21.22, 6.5% ahead of estimates. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the most recent consensus for BSE from 17 analysts is for revenues of ₹63.8b in 2027. If met, it would imply a solid 10% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to climb 18% to ₹81.68. Before this earnings report, the analysts had been forecasting revenues of ₹65.0b and earnings per share (EPS) of ₹83.77 in 2027. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.
See our latest analysis for BSE
It might be a surprise to learn that the consensus price target was broadly unchanged at ₹3,989, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on 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 BSE analyst has a price target of ₹4,850 per share, while the most pessimistic values it at ₹3,000. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await BSE shareholders.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the BSE's past performance and to peers in the same industry. We would highlight that BSE's revenue growth is expected to slow, with the forecast 14% annualised growth rate until the end of 2027 being well below the historical 45% p.a. growth over the last five years. Compare this to the 306 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 14% per year. So it's pretty clear that, while BSE's revenue growth is expected to slow, it's expected to grow roughly in line with the 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. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at ₹3,989, with the latest estimates not enough to have an impact on their price targets.
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 BSE analysts - going out to 2029, and you can see them free on our platform here.
We don't want to rain on the parade too much, but we did also find 1 warning sign for BSE that you need to be mindful of.
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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.