Barbeque Nation Hospitality Ltd. (NSE:BARBEQUE) Just Reported Earnings, And Analysts Cut Their Target Price

The yearly results for Barbeque Nation Hospitality Ltd. (NSE:BARBEQUE) were released last week, making it a good time to revisit its performance. The results don't look great, especially considering that statutory losses grew 79% to₹10.36 per share. Revenues of ₹8.9b did beat expectations by 2.5%, but it looks like a bit of a cold comfort. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Barbeque Nation Hospitality

Taking into account the latest results, the most recent consensus for Barbeque Nation Hospitality from four analysts is for revenues of ₹13.2b in 2023 which, if met, would be a sizeable 49% increase on its sales over the past 12 months. Barbeque Nation Hospitality is also expected to turn profitable, with statutory earnings of ₹18.45 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹12.8b and earnings per share (EPS) of ₹13.27 in 2023. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a considerable lift to earnings per share in particular.

Despite these upgrades, the consensus price target fell 7.8% to ₹1,403, perhaps signalling that the uplift in performance is not expected to last. 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. Currently, the most bullish analyst values Barbeque Nation Hospitality at ₹1,713 per share, while the most bearish prices it at ₹1,061. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Barbeque Nation Hospitality shareholders.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Barbeque Nation Hospitality's past performance and to peers in the same industry. It's clear from the latest estimates that Barbeque Nation Hospitality's rate of growth is expected to accelerate meaningfully, with the forecast 49% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 6.0% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 23% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Barbeque Nation Hospitality to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Barbeque Nation Hospitality following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Barbeque Nation Hospitality's future valuation.

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 Barbeque Nation Hospitality going out to 2025, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Barbeque Nation Hospitality that 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.