Gujarat Fluorochemicals Limited (NSE:FLUOROCHEM) Reported Earnings Last Week And Analysts Are Already Upgrading Their Estimates

It's been a pretty great week for Gujarat Fluorochemicals Limited (NSE:FLUOROCHEM) shareholders, with its shares surging 14% to ₹2,966 in the week since its latest third-quarter results. The results were positive, with revenue coming in at ₹10b, beating analyst expectations by 2.4%. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Gujarat Fluorochemicals

Taking into account the latest results, the consensus forecast from Gujarat Fluorochemicals' five analysts is for revenues of ₹42.8b in 2023, which would reflect a solid 15% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to soar 29% to ₹79.57. In the lead-up to this report, the analysts had been modelling revenues of ₹39.8b and earnings per share (EPS) of ₹70.12 in 2023. So it seems there's been a definite increase in optimism about Gujarat Fluorochemicals' future following the latest results, with a nice gain to the earnings per share forecasts in particular.

It will come as no surprise to learn that the analysts have increased their price target for Gujarat Fluorochemicals 11% to ₹2,998on the back of these upgrades. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Gujarat Fluorochemicals, with the most bullish analyst valuing it at ₹3,447 and the most bearish at ₹1,946 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We can infer from the latest estimates that forecasts expect a continuation of Gujarat Fluorochemicals'historical trends, as the 12% annualised revenue growth to the end of 2023 is roughly in line with the 12% annual revenue growth over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 14% per year. So it's pretty clear that Gujarat Fluorochemicals is expected to grow slower than similar companies in the same industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Gujarat Fluorochemicals following these results. Fortunately, they also upgraded their revenue estimates, although our data indicates sales are expected to perform worse 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Gujarat Fluorochemicals. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Gujarat Fluorochemicals going out to 2024, and you can see them free on our platform here..

You still need to take note of risks, for example - Gujarat Fluorochemicals has 1 warning sign we think you should be aware of.

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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.