Stock Analysis

Infibeam Avenues Limited Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

NSEI:INFIBEAM
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Infibeam Avenues Limited (NSE:INFIBEAM) just released its latest third-quarter results and things are looking bullish. The company beat forecasts, with revenue of ₹9.1b, some 7.1% above estimates, and statutory earnings per share (EPS) coming in at ₹0.15, 50% ahead of expectations. Earnings are an important time for investors, as they can track a company's performance, look at what the analyst is forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analyst has changed their mind on Infibeam Avenues after the latest results.

See our latest analysis for Infibeam Avenues

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NSEI:INFIBEAM Earnings and Revenue Growth January 26th 2024

After the latest results, the sole analyst covering Infibeam Avenues are now predicting revenues of ₹41.0b in 2025. If met, this would reflect a sizeable 32% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to climb 12% to ₹0.60. Yet prior to the latest earnings, the analyst had been anticipated revenues of ₹41.0b and earnings per share (EPS) of ₹0.82 in 2025. The analyst seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a pretty serious reduction to EPS estimates.

Althoughthe analyst has revised their earnings forecasts for next year, they've also lifted the consensus price target 9.4% to ₹29.00, suggesting the revised estimates are not indicative of a weaker long-term future for the business.

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. We can infer from the latest estimates that forecasts expect a continuation of Infibeam Avenues'historical trends, as the 25% annualised revenue growth to the end of 2025 is roughly in line with the 27% 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 not only is Infibeam Avenues expected to maintain its revenue growth despite the wider downturn, it's also forecast to grow faster than the industry as a whole.

The Bottom Line

The most important thing to take away is that the analyst downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, they also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Their estimates also suggest that Infibeam Avenues' revenue is expected to perform better than the wider industry. We note an upgrade to the price target, suggesting that the analyst believes the intrinsic value of the business is likely to improve over time.

With that in mind, we wouldn't be too quick to come to a conclusion on Infibeam Avenues. Long-term earnings power is much more important than next year's profits. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.

Before you take the next step you should know about the 3 warning signs for Infibeam Avenues that we have uncovered.

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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.