Shoppers Stop Limited (NSE:SHOPERSTOP) Consensus Forecasts Have Become A Little Darker Since Its Latest Report

Shoppers Stop Limited (NSE:SHOPERSTOP) shareholders are probably feeling a little disappointed, since its shares fell 7.7% to ₹690 in the week after its latest second-quarter results. It was a workmanlike result, with revenues of ₹11b coming in 2.2% ahead of expectations, and statutory earnings per share of ₹7.00, in line with analyst appraisals. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Shoppers Stop after the latest results.

View our latest analysis for Shoppers Stop

Following the latest results, Shoppers Stop's eight analysts are now forecasting revenues of ₹45.9b in 2025. This would be a modest 2.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 127% to ₹3.45. Before this earnings report, the analysts had been forecasting revenues of ₹50.0b and earnings per share (EPS) of ₹7.63 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a large cut to earnings per share numbers.

It'll come as no surprise then, to learn that the analysts have cut their price target 5.6% to ₹796. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Shoppers Stop at ₹1,070 per share, while the most bearish prices it at ₹600. 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.

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. We would highlight that Shoppers Stop's revenue growth is expected to slow, with the forecast 5.7% annualised growth rate until the end of 2025 being well below the historical 12% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 8.1% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Shoppers Stop.

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. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

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 Shoppers Stop 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 4 warning signs for Shoppers Stop (of which 1 shouldn't be ignored!) 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.