Zydus Lifesciences Limited (NSE:ZYDUSLIFE) Just Reported Earnings, And Analysts Cut Their Target Price

As you might know, Zydus Lifesciences Limited (NSE:ZYDUSLIFE) recently reported its second-quarter numbers. It looks like the results were a bit of a negative overall. While revenues of ₹52b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 4.7% to hit ₹9.06 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Zydus Lifesciences

After the latest results, the 31 analysts covering Zydus Lifesciences are now predicting revenues of ₹226.9b in 2025. If met, this would reflect a satisfactory 5.6% improvement in revenue compared to the last 12 months. Per-share earnings are expected to accumulate 5.1% to ₹44.66. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹225.0b and earnings per share (EPS) of ₹44.98 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

The consensus price target fell 5.1% to ₹1,109, suggesting that the analysts might have been a bit enthusiastic in their previous valuation - or they were expecting the company to provide stronger guidance in the quarterly results. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Zydus Lifesciences, with the most bullish analyst valuing it at ₹1,496 and the most bearish at ₹794 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Zydus Lifesciences' past performance and to peers in the same industry. The analysts are definitely expecting Zydus Lifesciences' growth to accelerate, with the forecast 12% annualised growth to the end of 2025 ranking favourably alongside historical growth of 8.2% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 11% annually. Zydus Lifesciences is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. 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 fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Zydus Lifesciences' future valuation.

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 Zydus Lifesciences going out to 2027, and you can see them free on our platform here..

However, before you get too enthused, we've discovered 1 warning sign for Zydus Lifesciences that you should be aware of.

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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.