Metro Brands Limited (NSE:METROBRAND) Just Missed Earnings: Here's What Analysts Think Will Happen Next

Metro Brands Limited (NSE:METROBRAND) just released its latest first-quarter report and things are not looking great. Metro Brands missed analyst forecasts, with revenues of ₹5.8b and statutory earnings per share (EPS) of ₹3.36, falling short by 7.6% and 8.0% respectively. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Metro Brands

Taking into account the latest results, the consensus forecast from Metro Brands' 19 analysts is for revenues of ₹26.4b in 2025. This reflects a meaningful 12% improvement in revenue compared to the last 12 months. Statutory per share are forecast to be ₹15.14, approximately in line with the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹27.8b and earnings per share (EPS) of ₹16.02 in 2025. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the small dip in earnings per share expectations.

The average price target climbed 5.3% to ₹1,260despite the reduced earnings forecasts, suggesting that this earnings impact could be a positive for the stock, once it passes. 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. The most optimistic Metro Brands analyst has a price target of ₹1,460 per share, while the most pessimistic values it at ₹875. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Metro Brands' past performance and to peers in the same industry. It's clear from the latest estimates that Metro Brands' rate of growth is expected to accelerate meaningfully, with the forecast 17% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 6.7% over the past year. Compare this with other companies in the same industry, which are forecast to see revenue growth of 21% annually. So it's clear that despite the acceleration in growth, Metro Brands is expected to grow meaningfully slower than the industry average.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

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 estimates - from multiple Metro Brands analysts - going out to 2027, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for Metro Brands 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.