IDP Education Limited Just Missed EPS By 33%: Here's What Analysts Think Will Happen Next

The investors in IDP Education Limited's (ASX:IEL) will be rubbing their hands together with glee today, after the share price leapt 21% to AU$5.62 in the week following its annual results. Results overall were not great, with earnings of AU$0.16 per share falling drastically short of analyst expectations. Meanwhile revenues hit AU$882m and were slightly better than forecasts. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on IDP Education after the latest results.

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Taking into account the latest results, the 13 analysts covering IDP Education provided consensus estimates of AU$845.4m revenue in 2026, which would reflect a perceptible 4.2% decline over the past 12 months. Statutory earnings per share are predicted to surge 44% to AU$0.23. Before this earnings report, the analysts had been forecasting revenues of AU$862.7m and earnings per share (EPS) of AU$0.24 in 2026. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a minor downgrade to earnings per share estimates.

View our latest analysis for IDP Education

What's most unexpected is that the consensus price target rose 8.0% to AU$7.05, strongly implying the downgrade to forecasts is not expected to be more than a temporary blip. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on IDP Education, with the most bullish analyst valuing it at AU$17.00 and the most bearish at AU$4.15 per share. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.

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. We would highlight that revenue is expected to reverse, with a forecast 4.2% annualised decline to the end of 2026. That is a notable change from historical growth of 14% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 7.6% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - IDP Education is expected to lag the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for IDP Education. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple IDP Education analysts - going out to 2028, and you can see them free on our platform here.

You still need to take note of risks, for example - IDP Education has 2 warning signs we think you should be aware 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.