Carborundum Universal Limited (NSE:CARBORUNIV) Released Earnings Last Week And Analysts Lifted Their Price Target To ₹1,459

It's been a good week for Carborundum Universal Limited (NSE:CARBORUNIV) shareholders, because the company has just released its latest annual results, and the shares gained 5.1% to ₹1,495. Results overall were respectable, with statutory earnings of ₹24.22 per share roughly in line with what the analysts had forecast. Revenues of ₹48b came in 2.1% ahead of analyst predictions. 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 Carborundum Universal after the latest results.

See our latest analysis for Carborundum Universal

Following the latest results, Carborundum Universal's twelve analysts are now forecasting revenues of ₹52.4b in 2025. This would be a meaningful 9.6% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to bounce 26% to ₹30.65. Before this earnings report, the analysts had been forecasting revenues of ₹53.0b and earnings per share (EPS) of ₹30.39 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

With the analysts reconfirming their revenue and earnings forecasts, it's surprising to see that the price target rose 15% to ₹1,459. It looks as though they previously had some doubts over whether the business would live up to their expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Carborundum Universal, with the most bullish analyst valuing it at ₹1,700 and the most bearish at ₹942 per share. 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 Carborundum Universal 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. We would highlight that Carborundum Universal's revenue growth is expected to slow, with the forecast 9.6% annualised growth rate until the end of 2025 being well below the historical 16% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 12% annually. Factoring in the forecast slowdown in growth, it seems obvious that Carborundum Universal is also expected to grow slower than other industry participants.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Carborundum Universal's revenue is expected to perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Carborundum Universal going out to 2027, and you can see them free on our platform here.

You can also see our analysis of Carborundum Universal's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.