Earnings Update: Here's Why Analysts Just Lifted Their Happiest Minds Technologies Limited (NSE:HAPPSTMNDS) Price Target To ₹1,510

Happiest Minds Technologies Limited (NSE:HAPPSTMNDS) shareholders are probably feeling a little disappointed, since its shares fell 2.5% to ₹1,154 in the week after its latest quarterly results. It was a workmanlike result, with revenues of ₹2.8b coming in 2.6% ahead of expectations, and statutory earnings per share of ₹11.45, in line with analyst appraisals. The analyst 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. So we collected the latest post-earnings statutory consensus estimate to see what could be in store for next year.

View our latest analysis for Happiest Minds Technologies

Following the latest results, Happiest Minds Technologies' lone analyst are now forecasting revenues of ₹12.6b in 2023. This would be a substantial 25% improvement in sales compared to the last 12 months. In the lead-up to this report, the analyst had been modelling revenues of ₹12.3b and earnings per share (EPS) of ₹17.26 in 2023. What's really interesting is that while the consensus made a small increase to revenue estimates, it no longer provides an earnings per share estimate, suggesting that revenues are now the focus of the business after this latest result.

The average price target rose 139% to ₹1,510, with the analyst clearly having become more optimistic about Happiest Minds Technologies'prospects following these results.

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. It's clear from the latest estimates that Happiest Minds Technologies' rate of growth is expected to accelerate meaningfully, with the forecast 19% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 16% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 12% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analyst also expect Happiest Minds Technologies to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analyst upgraded their revenue estimates for next year. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analyst believes the intrinsic value of the business is likely to improve over time.

One Happiest Minds Technologies broker/analyst has provided estimates out to 2024, which can be seen for free on our platform here.

You can also see our analysis of Happiest Minds Technologies' Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.