UTI Asset Management Company Limited Just Beat Revenue Estimates By 27%

A week ago, UTI Asset Management Company Limited (NSE:UTIAMC) came out with a strong set of quarterly numbers that could potentially lead to a re-rate of the stock. Revenue of ₹5.4b beat expectations by 27% and statutory earnings per share (EPS) of ₹18.67 exceeded forecasts by 20%. 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.

See our latest analysis for UTI Asset Management

Following last week's earnings report, UTI Asset Management's twelve analysts are forecasting 2025 revenues to be ₹19.3b, approximately in line with the last 12 months. Statutory earnings per share are predicted to rise 5.5% to ₹69.63. Before this earnings report, the analysts had been forecasting revenues of ₹18.6b and earnings per share (EPS) of ₹63.09 in 2025. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a substantial gain in earnings per share in particular.

With these upgrades, we're not surprised to see that the analysts have lifted their price target 6.0% to ₹1,230per 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 UTI Asset Management analyst has a price target of ₹1,520 per share, while the most pessimistic values it at ₹945. 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 UTI Asset Management shareholders.

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 revenue is expected to slow, with a forecast annualised decline of 0.1% by the end of 2025. This indicates a significant reduction from annual growth of 13% 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 13% per year. It's pretty clear that UTI Asset Management's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around UTI Asset Management's earnings potential next year. They also upgraded their revenue estimates for next year, even though it is expected to grow slower than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for UTI Asset Management going out to 2027, and you can see them free on our platform here.

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with UTI Asset Management , and understanding this should be part of your investment process.

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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.