MTAR Technologies Limited (NSE:MTARTECH) Analysts Are Reducing Their Forecasts For This Year

The analysts covering MTAR Technologies Limited (NSE:MTARTECH) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. 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.

Following the latest downgrade, MTAR Technologies' three analysts currently expect revenues in 2024 to be ₹6.7b, approximately in line with the last 12 months. Statutory earnings per share are anticipated to decrease 3.2% to ₹32.50 in the same period. Previously, the analysts had been modelling revenues of ₹8.4b and earnings per share (EPS) of ₹48.31 in 2024. Indeed, we can see that the analysts are a lot more bearish about MTAR Technologies' prospects, administering a substantial drop in revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for MTAR Technologies

Despite the cuts to forecast earnings, there was no real change to the ₹2,556 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value.

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. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 1.3% by the end of 2024. This indicates a significant reduction from annual growth of 42% over the last three years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 12% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - MTAR Technologies is expected to lag the wider industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for MTAR Technologies. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that MTAR Technologies' revenues are expected to grow slower than 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 MTAR Technologies.

So things certainly aren't looking great, and you should also know that we've spotted some potential warning signs with MTAR Technologies, including recent substantial insider selling. Learn more, and discover the 1 other risk we've identified, for free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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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.