One Analyst's Earnings Estimates For Trident Limited (NSE:TRIDENT) Are Surging Higher

By
Simply Wall St
Published
January 22, 2022
NSEI:TRIDENT
Source: Shutterstock

Celebrations may be in order for Trident Limited (NSE:TRIDENT) shareholders, with the covering analyst delivering a significant upgrade to their statutory estimates for the company. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with the analyst modelling a real improvement in business performance.

After the upgrade, the solo analyst covering Trident is now predicting revenues of ₹77b in 2022. If met, this would reflect a notable 20% improvement in sales compared to the last 12 months. Per-share earnings are expected to climb 17% to ₹1.70. Previously, the analyst had been modelling revenues of ₹66b and earnings per share (EPS) of ₹1.50 in 2022. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

See our latest analysis for Trident

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NSEI:TRIDENT Earnings and Revenue Growth January 22nd 2022

With these upgrades, we're not surprised to see that the analyst has lifted their price target 41% to ₹64.00 per share. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Trident analyst has a price target of ₹55.09 per share, while the most pessimistic values it at ₹51.08. Even so, with a relatively close grouping of estimates, it looks like the analyst is quite confident in their valuations, suggesting Trident is an easy business to forecast or the underlying assumptions are obvious.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Trident's past performance and to peers in the same industry. It's clear from the latest estimates that Trident's rate of growth is expected to accelerate meaningfully, with the forecast 20% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 3.0% p.a. over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 17% per year. Trident is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

The Bottom Line

The biggest takeaway for us from these new estimates is that the analyst upgraded their earnings per share estimates, with improved earnings power expected for this year. 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 market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, Trident could be worth investigating further.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for Trident going out as far as 2024, and you can see them 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 upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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