Analysts Have Made A Financial Statement On Suven Pharmaceuticals Limited's (NSE:SUVENPHAR) Full-Year Report

Suven Pharmaceuticals Limited (NSE:SUVENPHAR) shareholders are probably feeling a little disappointed, since its shares fell 7.4% to ₹480 in the week after its latest yearly results. It was a pretty mixed result, with revenues beating expectations to hit ₹10b. Statutory earnings fell 3.2% short of analyst forecasts, reaching ₹14.23 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.

See our latest analysis for Suven Pharmaceuticals

Taking into account the latest results, the consensus forecast from Suven Pharmaceuticals' three analysts is for revenues of ₹11.4b in 2022, which would reflect a solid 12% improvement in sales compared to the last 12 months. Per-share earnings are expected to expand 13% to ₹16.05. Before this earnings report, the analysts had been forecasting revenues of ₹11.6b and earnings per share (EPS) of ₹17.37 in 2022. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

It might be a surprise to learn that the consensus price target was broadly unchanged at ₹582, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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 Suven Pharmaceuticals analyst has a price target of ₹600 per share, while the most pessimistic values it at ₹552. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Suven Pharmaceuticals is an easy business to forecast or the the analysts are all using similar assumptions.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Suven Pharmaceuticals' revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 12% growth on an annualised basis. This is compared to a historical growth rate of 23% over the past year. Compare this to the 132 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 11% per year. So it's pretty clear that, while Suven Pharmaceuticals' revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Suven Pharmaceuticals. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall industry. The consensus price target held steady at ₹582, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Suven Pharmaceuticals going out to 2023, and you can see them free on our platform here..

It is also worth noting that we have found 1 warning sign for Suven Pharmaceuticals that you need to take into consideration.

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This article by Simply Wall St is general in nature. 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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