What You Need To Know About The BSE Limited (NSE:BSE) Analyst Downgrade Today

The latest analyst coverage could presage a bad day for BSE Limited (NSE:BSE), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

Following the downgrade, the consensus from three analysts covering BSE is for revenues of ₹8.8b in 2024, implying a definite 11% decline in sales compared to the last 12 months. Prior to the latest estimates, the analysts were forecasting revenues of ₹9.9b in 2024. It looks like forecasts have become a fair bit less optimistic on BSE, given the measurable cut to revenue estimates.

See our latest analysis for BSE

Additionally, the consensus price target for BSE increased 11% to ₹730, showing a clear increase in optimism from the analysts involved.

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. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 15% by the end of 2024. This indicates a significant reduction from annual growth of 8.5% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 9.2% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - BSE is expected to lag the wider industry.

The Bottom Line

The clear low-light was that analysts slashing their revenue forecasts for BSE this year. They also expect company revenue to perform worse than the wider market. There was also an increase in the price target, suggesting that there is more optimism baked into the forecasts than there was previously. Given the stark change in sentiment, we'd understand if investors became more cautious on BSE after today.

Unanswered questions? At least one of BSE's three analysts has provided estimates out to 2026, which can be seen for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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.