In This Article:
Kaveri Seed Company Limited (NSE:KSCL) last week reported its latest quarterly results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Kaveri Seed missed revenue estimates by 2.7%, with sales of ₹1.2b, although earnings per share (EPS) of ₹33.72 beat expectations, coming in 3.8% ahead of analyst estimates. This is an important time for investors, as they can track a company's performance in its report, look at what top analysts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest forecasts to see what analysts are expecting for next year.
View our latest analysis for Kaveri Seed
After the latest results, the four analysts covering Kaveri Seed are now predicting revenues of ₹9.19b in 2020. If met, this would reflect a reasonable 4.0% improvement in sales compared to the last 12 months. Earnings per share are expected to decrease 6.5% to ₹35.31 in the same period. In the lead-up to this report, analysts had been modelling revenues of ₹9.15b and earnings per share (EPS) of ₹37.93 in 2020. 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 analysts did make a small dip in their earnings per share forecasts.
It might be a surprise to learn that the consensus price target was broadly unchanged at ₹610, with analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. The consensus price target just an average of individual analyst targets, so - considering that the price target changed, it would be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Kaveri Seed at ₹750 per share, while the most bearish prices it at ₹480. 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.
Further, we can compare these estimates to past performance, and see how Kaveri Seed forecasts compare to the wider market's forecast performance. One thing stands out from these estimates, which is that analysts are forecasting Kaveri Seed to grow faster in the future than it has in the past, with revenues expected to grow 4.0%. If achieved, this would be a much better result than the 6.1% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 12% per year. So although Kaveri Seed's revenue growth is expected to improve, it is still expected to grow slower than the market.