Huhtamaki India Limited (NSE:HUHTAMAKI) Analysts Are Pretty Bullish On The Stock After Recent Results

Last week saw the newest second-quarter earnings release from Huhtamaki India Limited (NSE:HUHTAMAKI), an important milestone in the company's journey to build a stronger business. Results overall were respectable, with statutory earnings of ₹54.24 per share roughly in line with what the analyst had forecast. Revenues of ₹6.4b came in 2.3% ahead of analyst predictions. 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.

Check out our latest analysis for Huhtamaki India

Taking into account the latest results, Huhtamaki India's sole analyst currently expect revenues in 2024 to be ₹25.4b, approximately in line with the last 12 months. Statutory earnings per share are forecast to dive 67% to ₹18.50 in the same period. Yet prior to the latest earnings, the analyst had been anticipated revenues of ₹26.3b and earnings per share (EPS) of ₹14.10 in 2024. Although the analyst has lowered their revenue forecasts, they've also made a sizeable expansion in their earnings per share estimates, which implies there's been something of an uptick in sentiment following the latest results.

The average price target rose 53% to ₹419, with the analyst signalling that the improved earnings outlook is the key driver of value for shareholders - enough to offset the reduction in revenue estimates.

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. The analyst is definitely expecting Huhtamaki India's growth to accelerate, with the forecast 2.2% annualised growth to the end of 2024 ranking favourably alongside historical growth of 1.5% per annum 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 12% per year. So it's clear that despite the acceleration in growth, Huhtamaki India is expected to grow meaningfully slower than the industry average.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Huhtamaki India's earnings potential next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Still, earnings per share are more important to value creation for shareholders. There was also a nice increase in the price target, with the analyst clearly feeling that the intrinsic value of the business is improving.

With that in mind, we wouldn't be too quick to come to a conclusion on Huhtamaki India. Long-term earnings power is much more important than next year's profits. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.

Plus, you should also learn about the 2 warning signs we've spotted with Huhtamaki India (including 1 which is concerning) .

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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.

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