This Navneet Education Limited (NSE:NAVNETEDUL) Analyst Is Way More Bearish Than They Used To Be

The latest analyst coverage could presage a bad day for Navneet Education Limited (NSE:NAVNETEDUL), with the covering analyst making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analyst has soured majorly on the business.

Following the downgrade, the most recent consensus for Navneet Education from its lone analyst is for revenues of ₹11b in 2022 which, if met, would be a major 35% increase on its sales over the past 12 months. Statutory earnings per share are presumed to shoot up 60% to ₹3.90. Before this latest update, the analyst had been forecasting revenues of ₹15b and earnings per share (EPS) of ₹8.60 in 2022. Indeed, we can see that the analyst is a lot more bearish about Navneet Education's prospects, administering a sizeable cut to revenue estimates and slashing their EPS estimates to boot.

See our latest analysis for Navneet Education

The consensus price target fell 6.1% to ₹92.00, with the weaker earnings outlook clearly leading analyst valuation estimates.

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. For example, we noticed that Navneet Education's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 35% growth to the end of 2022 on an annualised basis. That is well above its historical decline of 0.9% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 14% annually. Not only are Navneet Education's revenues expected to improve, it seems that the analyst is also expecting it to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analyst cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately, the analyst also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. After such a stark change in sentiment from the analyst, we'd understand if readers now felt a bit wary of Navneet Education.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have analyst estimates for Navneet Education going out as far as 2023, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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