Max Financial Services Limited Just Missed Earnings - But Analysts Have Updated Their Models

It's been a good week for Max Financial Services Limited (NSE:MFSL) shareholders, because the company has just released its latest annual results, and the shares gained 6.9% to ₹1,358. It was not a great result overall. Although revenues beat expectations, hitting ₹465b, statutory earnings missed analyst forecasts by 17%, coming in at just ₹9.61 per share. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Max Financial Services after the latest results.

This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality.

Taking into account the latest results, the current consensus from Max Financial Services' eleven analysts is for revenues of ₹516.0b in 2026. This would reflect a notable 11% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to surge 25% to ₹11.99. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹522.8b and earnings per share (EPS) of ₹15.37 in 2026. So there's definitely been a decline in sentiment after the latest results, noting the pretty serious reduction to new EPS forecasts.

Check out our latest analysis for Max Financial Services

Althoughthe analysts have revised their earnings forecasts for next year, they've also lifted the consensus price target 7.4% to ₹1,493, suggesting the revised estimates are not indicative of a weaker long-term future for the business. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Max Financial Services at ₹1,750 per share, while the most bearish prices it at ₹1,330. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Max Financial Services' past performance and to peers in the same industry. It's pretty clear that there is an expectation that Max Financial Services' revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 11% growth on an annualised basis. This is compared to a historical growth rate of 17% over the past five years. Compare this to the 13 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 9.9% per year. Factoring in the forecast slowdown in growth, it looks like Max Financial Services is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Max Financial Services. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Max Financial Services analysts - going out to 2028, and you can see them free on our platform here.

We also provide an overview of the Max Financial Services Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.