Bharat Heavy Electricals Limited (NSE:BHEL) Analysts Just Slashed This Year's Estimates

Today is shaping up negative for Bharat Heavy Electricals Limited (NSE:BHEL) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Both revenue and earnings per share (EPS) estimates were cut sharply as analysts factored in the latest outlook for the business, concluding that they were too optimistic previously.

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Following the downgrade, the most recent consensus for Bharat Heavy Electricals from its 16 analysts is for revenues of ₹353b in 2026 which, if met, would be a huge 25% increase on its sales over the past 12 months. Per-share earnings are expected to soar 255% to ₹5.45. Previously, the analysts had been modelling revenues of ₹424b and earnings per share (EPS) of ₹7.87 in 2026. It looks like analyst sentiment has declined substantially, with a substantial drop in revenue estimates and a pretty serious decline to earnings per share numbers as well.

Check out our latest analysis for Bharat Heavy Electricals

Analysts made no major changes to their price target of ₹217, suggesting the downgrades are not expected to have a long-term impact on Bharat Heavy Electricals' valuation.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting Bharat Heavy Electricals' growth to accelerate, with the forecast 25% annualised growth to the end of 2026 ranking favourably alongside historical growth of 9.1% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 21% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Bharat Heavy Electricals is expected to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. There was also a drop in their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider market. The lack of change in the price target is puzzling in light of the downgrade but, with a serious decline expected this year, we wouldn't be surprised if investors were a bit wary of Bharat Heavy Electricals.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for Bharat Heavy Electricals going out to 2028, and you can see them free on our platform here.

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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.