Deepak Fertilisers And Petrochemicals Corporation Limited Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

Shareholders of Deepak Fertilisers And Petrochemicals Corporation Limited (NSE:DEEPAKFERT) will be pleased this week, given that the stock price is up 12% to ₹638 following its latest full-year results. It looks like a credible result overall - although revenues of ₹77b were what the analyst expected, Deepak Fertilisers And Petrochemicals surprised by delivering a (statutory) profit of ₹58.25 per share, an impressive 22% above what was forecast. 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. So we gathered the latest post-earnings forecasts to see what estimate suggests is in store for next year.

See our latest analysis for Deepak Fertilisers And Petrochemicals

Taking into account the latest results, the current consensus from Deepak Fertilisers And Petrochemicals' single analyst is for revenues of ₹98.2b in 2023, which would reflect a major 28% increase on its sales over the past 12 months. Statutory per-share earnings are expected to be ₹56.90, roughly flat on the last 12 months. Yet prior to the latest earnings, the analyst had been anticipated revenues of ₹84.6b and earnings per share (EPS) of ₹51.20 in 2023. So we can see there's been a pretty clear increase in sentiment following the latest results, with both revenues and earnings per share receiving a decent lift in the latest estimates.

With these upgrades, we're not surprised to see that the analyst has lifted their price target 7.8% to ₹900per share.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that Deepak Fertilisers And Petrochemicals' rate of growth is expected to accelerate meaningfully, with the forecast 28% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 4.6% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 13% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Deepak Fertilisers And Petrochemicals is expected to grow much faster than its industry.

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 Deepak Fertilisers And Petrochemicals following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster 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.

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. At least one analyst has provided forecasts out to 2025, which can be seen for free on our platform here.

Plus, you should also learn about the 2 warning signs we've spotted with Deepak Fertilisers And Petrochemicals .

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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.