Earnings Update: Here's Why Analysts Just Lifted Their Poly Medicure Limited (NSE:POLYMED) Price Target To ₹1,195

Poly Medicure Limited (NSE:POLYMED) just released its latest full-year results and things are looking bullish. The company beat expectations with revenues of ₹8.0b arriving 2.2% ahead of forecasts. Statutory earnings per share (EPS) were ₹15.24, 4.4% ahead of estimates. The analyst typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analyst latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Poly Medicure

Taking into account the latest results, the consensus forecast from Poly Medicure's lone analyst is for revenues of ₹9.47b in 2022, which would reflect a solid 18% improvement in sales compared to the last 12 months. Per-share earnings are expected to surge 23% to ₹18.70. Yet prior to the latest earnings, the analyst had been anticipated revenues of ₹9.18b and earnings per share (EPS) of ₹17.10 in 2022. It looks like there's been a modest increase in sentiment following the latest results, withthe analyst becoming a bit more optimistic in their predictions for both revenues and earnings.

It will come as no surprise to learn that the analyst has increased their price target for Poly Medicure 93% to ₹1,195on the back of these upgrades.

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. The analyst is definitely expecting Poly Medicure's growth to accelerate, with the forecast 18% annualised growth to the end of 2022 ranking favourably alongside historical growth of 12% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 16% annually. Poly Medicure is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

The Bottom Line

The most important thing here is that the analyst upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Poly Medicure following these results. They also upgraded their revenue forecasts, although the latest estimates suggest that Poly Medicure will grow in line with the overall 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At least one analyst has provided forecasts out to 2023, which can be seen for free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for Poly Medicure you should know about.

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