Aavas Financiers Limited Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

It's shaping up to be a tough period for Aavas Financiers Limited (NSE:AAVAS), which a week ago released some disappointing quarterly results that could have a notable impact on how the market views the stock. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at ₹2.9b, statutory earnings missed forecasts by 11%, coming in at just ₹14.73 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Aavas Financiers

Taking into account the latest results, the consensus forecast from Aavas Financiers' 13 analysts is for revenues of ₹14.6b in 2025. This reflects a major 29% improvement in revenue compared to the last 12 months. Per-share earnings are expected to shoot up 26% to ₹75.92. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹15.0b and earnings per share (EPS) of ₹78.23 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.

The analysts made no major changes to their price target of ₹1,730, suggesting the downgrades are not expected to have a long-term impact on Aavas Financiers' valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Aavas Financiers at ₹2,025 per share, while the most bearish prices it at ₹1,328. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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 can infer from the latest estimates that forecasts expect a continuation of Aavas Financiers'historical trends, as the 23% annualised revenue growth to the end of 2025 is roughly in line with the 20% annual growth over the past five years. Compare this with the broader industry (in aggregate), which analyst estimates suggest will see revenues fall 16% per year. So it's clear that not only is revenue growth expected to be maintained, but Aavas Financiers is expected to grow meaningfully faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Aavas Financiers. Sadly they also cut their revenue estimates, although at least the company is expected to perform a bit better 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 Aavas Financiers. Long-term earnings power is much more important than next year's profits. We have forecasts for Aavas Financiers going out to 2026, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 1 warning sign for Aavas Financiers you should know about.

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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.