Results: Shoppers Stop Limited Beat Earnings Expectations And Analysts Now Have New Forecasts

The annual results for Shoppers Stop Limited (NSE:SHOPERSTOP) were released last week, making it a good time to revisit its performance. It looks like a credible result overall - although revenues of ₹43b were in line with what the analysts predicted, Shoppers Stop surprised by delivering a statutory profit of ₹7.00 per share, a notable 15% above expectations. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Shoppers Stop

Taking into account the latest results, the consensus forecast from Shoppers Stop's seven analysts is for revenues of ₹49.7b in 2025. This reflects a solid 15% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to shoot up 79% to ₹12.60. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹52.4b and earnings per share (EPS) of ₹17.93 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a pretty serious reduction to earnings per share numbers.

The analysts made no major changes to their price target of ₹820, suggesting the downgrades are not expected to have a long-term impact on Shoppers Stop's valuation. 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 Shoppers Stop analyst has a price target of ₹1,250 per share, while the most pessimistic values it at ₹600. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Shoppers Stop's growth to accelerate, with the forecast 15% annualised growth to the end of 2025 ranking favourably alongside historical growth of 6.9% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 8.8% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Shoppers Stop is expected to grow much faster than its industry.

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. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Shoppers Stop. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Shoppers Stop going out to 2026, and you can see them free on our platform here..

Before you take the next step you should know about the 2 warning signs for Shoppers Stop (1 is concerning!) that we have uncovered.

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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.