The Consensus EPS Estimates For Pitti Engineering Limited (NSE:PITTIENG) Just Fell A Lot

One thing we could say about the covering analyst on Pitti Engineering Limited (NSE:PITTIENG) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Both revenue and earnings per share (EPS) estimates were cut sharply as the analyst factored in the latest outlook for the business, concluding that they were too optimistic previously.

After the downgrade, the solo analyst covering Pitti Engineering is now predicting revenues of ₹17b in 2025. If met, this would reflect a solid 11% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to be ₹35.20, roughly flat on the last 12 months. Prior to this update, the analyst had been forecasting revenues of ₹20b and earnings per share (EPS) of ₹49.00 in 2025. It looks like analyst sentiment has declined substantially, with a measurable cut to revenue estimates and a large cut to earnings per share numbers as well.

Check out our latest analysis for Pitti Engineering

The consensus price target fell 13% to ₹1,343, with the weaker earnings outlook clearly leading analyst valuation estimates.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that Pitti Engineering's revenue growth is expected to slow, with the forecast 11% annualised growth rate until the end of 2025 being well below the historical 23% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 21% annually. Factoring in the forecast slowdown in growth, it seems obvious that Pitti Engineering is also expected to grow slower than other industry participants.

The Bottom Line

The biggest issue in the new estimates is that the analyst has reduced their earnings per share estimates, suggesting business headwinds lay ahead for Pitti Engineering. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. With a serious cut to this year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of Pitti Engineering.

There might be good reason for analyst bearishness towards Pitti Engineering, like dilutive stock issuance over the past year. Learn more, and discover the 2 other concerns we've identified, for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies backed by insiders.

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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.