Analysts Have Lowered Expectations For Sterling and Wilson Renewable Energy Limited (NSE:SWSOLAR) After Its Latest Results

Sterling and Wilson Renewable Energy Limited (NSE:SWSOLAR) shareholders are probably feeling a little disappointed, since its shares fell 4.7% to ₹663 in the week after its latest first-quarter results. Revenues fell badly short of expectations, with revenue of ₹9.2b, missing analyst estimates by 41%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Sterling and Wilson Renewable Energy

Taking into account the latest results, the current consensus from Sterling and Wilson Renewable Energy's twin analysts is for revenues of ₹82.7b in 2025. This would reflect a huge 141% increase on its revenue over the past 12 months. Sterling and Wilson Renewable Energy is also expected to turn profitable, with statutory earnings of ₹19.95 per share. Before this earnings report, the analysts had been forecasting revenues of ₹89.4b and earnings per share (EPS) of ₹22.05 in 2025. 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.

Despite the cuts to forecast earnings, there was no real change to the ₹834 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Sterling and Wilson Renewable Energy's past performance and to peers in the same industry. One thing stands out from these estimates, which is that Sterling and Wilson Renewable Energy is forecast to grow faster in the future than it has in the past, with revenues expected to display 223% annualised growth until the end of 2025. If achieved, this would be a much better result than the 21% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 13% annually. So it looks like Sterling and Wilson Renewable Energy is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Sterling and Wilson Renewable Energy. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Sterling and Wilson Renewable Energy. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Sterling and Wilson Renewable Energy going out as far as 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - Sterling and Wilson Renewable Energy has 2 warning signs we think you should be aware of.

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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.

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