Earnings Miss: Craftsman Automation Limited Missed EPS By 9.4% And Analysts Are Revising Their Forecasts

The analysts might have been a bit too bullish on Craftsman Automation Limited (NSE:CRAFTSMAN), given that the company fell short of expectations when it released its full-year results last week. Craftsman Automation missed analyst forecasts, with revenues of ₹45b and statutory earnings per share (EPS) of ₹144, falling short by 2.3% and 9.4% respectively. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Craftsman Automation after the latest results.

Check out our latest analysis for Craftsman Automation

Taking into account the latest results, the most recent consensus for Craftsman Automation from eight analysts is for revenues of ₹50.2b in 2025. If met, it would imply a solid 13% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 20% to ₹173. In the lead-up to this report, the analysts had been modelling revenues of ₹51.1b and earnings per share (EPS) of ₹195 in 2025. So there's definitely been a decline in sentiment after the latest results, noting the substantial drop in new EPS forecasts.

The average price target fell 6.2% to ₹4,981, with reduced earnings forecasts clearly tied to a lower valuation estimate. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Craftsman Automation analyst has a price target of ₹5,305 per share, while the most pessimistic values it at ₹4,450. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that Craftsman Automation's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 13% growth on an annualised basis. This is compared to a historical growth rate of 23% over the past five years. Compare this to the 200 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 13% per year. So it's pretty clear that, while Craftsman Automation's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Craftsman Automation. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

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 forecasts for Craftsman Automation going out to 2027, and you can see them free on our platform here.

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with Craftsman Automation , and understanding it should be part of your investment process.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.