Happy Forgings Limited (NSE:HAPPYFORGE) Just Reported And Analysts Have Been Cutting Their Estimates

Shareholders might have noticed that Happy Forgings Limited (NSE:HAPPYFORGE) filed its annual result this time last week. The early response was not positive, with shares down 2.4% to ₹815 in the past week. Happy Forgings reported in line with analyst predictions, delivering revenues of ₹14b and statutory earnings per share of ₹28.37, suggesting the business is executing well and in line with its plan. 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 Happy Forgings after the latest results.

Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit.

After the latest results, the five analysts covering Happy Forgings are now predicting revenues of ₹15.6b in 2026. If met, this would reflect a modest 7.7% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to accumulate 7.5% to ₹30.52. Before this earnings report, the analysts had been forecasting revenues of ₹16.4b and earnings per share (EPS) of ₹33.52 in 2026. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a small dip in earnings per share estimates.

See our latest analysis for Happy Forgings

The consensus price target fell 8.0% to ₹968, with the weaker earnings outlook clearly leading valuation estimates. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Happy Forgings at ₹1,050 per share, while the most bearish prices it at ₹831. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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. It's pretty clear that there is an expectation that Happy Forgings' revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 7.7% growth on an annualised basis. This is compared to a historical growth rate of 17% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 12% per year. Factoring in the forecast slowdown in growth, it seems obvious that Happy Forgings is also expected to grow slower than other industry participants.

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. 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. 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 Happy Forgings going out to 2028, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Happy Forgings that you should be aware of.

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.