Firstsource Solutions Limited (NSE:FSL) Just Reported Third-Quarter Earnings: Have Analysts Changed Their Mind On The Stock?

Investors in Firstsource Solutions Limited (NSE:FSL) had a good week, as its shares rose 7.0% to close at ₹357 following the release of its quarterly results. It looks like the results were a bit of a negative overall. While revenues of ₹21b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 2.5% to hit ₹2.27 per share. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for Firstsource Solutions

Taking into account the latest results, the most recent consensus for Firstsource Solutions from eleven analysts is for revenues of ₹93.2b in 2026. If met, it would imply a huge 24% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to jump 44% to ₹11.83. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹91.4b and earnings per share (EPS) of ₹11.87 in 2026. So it looks like there's been no major change in sentiment following the latest results, although the analysts have made a small increase to to revenue forecasts.

It may not be a surprise to see thatthe analysts have reconfirmed their price target of ₹395, implying that the uplift in revenue is not expected to greatly contribute to Firstsource Solutions's valuation in the near term. 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. There are some variant perceptions on Firstsource Solutions, with the most bullish analyst valuing it at ₹413 and the most bearish at ₹350 per share. 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. The analysts are definitely expecting Firstsource Solutions' growth to accelerate, with the forecast 19% annualised growth to the end of 2026 ranking favourably alongside historical growth of 10% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 15% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Firstsource Solutions is expected to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Firstsource Solutions going out to 2027, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for Firstsource Solutions that you need to be mindful 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.