Analysts Just Slashed Their Gland Pharma Limited (NSE:GLAND) EPS Numbers

One thing we could say about the analysts on Gland Pharma Limited (NSE:GLAND) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business.

After this downgrade, Gland Pharma's 13 analysts are now forecasting revenues of ₹45b in 2023. This would be a notable 8.6% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to increase 8.2% to ₹71.62. Before this latest update, the analysts had been forecasting revenues of ₹53b and earnings per share (EPS) of ₹85.20 in 2023. It looks like analyst sentiment has declined substantially, with a substantial drop in revenue estimates and a real cut to earnings per share numbers as well.

View our latest analysis for Gland Pharma

The consensus price target fell 13% to ₹3,168, with the weaker earnings outlook clearly leading analyst valuation estimates. 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. The most optimistic Gland Pharma analyst has a price target of ₹4,930 per share, while the most pessimistic values it at ₹2,725. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.

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 Gland Pharma'shistorical trends, as the 12% annualised revenue growth to the end of 2023 is roughly in line with the 10% annual revenue growth over the past year. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 11% annually. It's clear that while Gland Pharma's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. There was also a drop in their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of Gland Pharma.

Uncomfortably, our automated valuation tool also suggests that Gland Pharma stock could be overvalued following the downgrade. Shareholders could be left disappointed if these estimates play out. You can learn more about our valuation methodology for 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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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.