Earnings Miss: Gland Pharma Limited Missed EPS By 15% And Analysts Are Revising Their Forecasts

It's been a good week for Gland Pharma Limited (NSE:GLAND) shareholders, because the company has just released its latest full-year results, and the shares gained 5.3% to ₹1,886. It was not a great result overall. Although revenues beat expectations, hitting ₹58b, statutory earnings missed analyst forecasts by 15%, coming in at just ₹46.89 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Gland Pharma

Following the latest results, Gland Pharma's ten analysts are now forecasting revenues of ₹64.0b in 2025. This would be a solid 9.7% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 24% to ₹57.99. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹63.2b and earnings per share (EPS) of ₹66.98 in 2025. So there's definitely been a decline in sentiment after the latest results, noting the substantial drop in new EPS forecasts.

The consensus price target held steady at ₹1,834, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Gland Pharma analyst has a price target of ₹3,120 per share, while the most pessimistic values it at ₹873. We would probably assign less value to the analyst forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Gland Pharma's revenue growth is expected to slow, with the forecast 9.7% annualised growth rate until the end of 2025 being well below the historical 14% p.a. growth over the last five years. Compare this to the 161 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 10% per year. Factoring in the forecast slowdown in growth, it looks like Gland Pharma is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Gland Pharma. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. The consensus price target held steady at ₹1,834, with the latest estimates not enough to have an impact on their price targets.

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. We have forecasts for Gland Pharma going out to 2027, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for Gland Pharma you should know about.

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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.