Persistent Systems Limited (NSE:PERSISTENT) Analysts Are Pretty Bullish On The Stock After Recent Results

Investors in Persistent Systems Limited (NSE:PERSISTENT) had a good week, as its shares rose 8.3% to close at ₹8,254 following the release of its third-quarter results. Persistent Systems reported ₹25b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of ₹37.20 beat expectations, being 2.8% higher than what the analysts expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Persistent Systems

Following the latest results, Persistent Systems' 32 analysts are now forecasting revenues of ₹114.1b in 2025. This would be a major 20% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 32% to ₹185. Before this earnings report, the analysts had been forecasting revenues of ₹113.4b and earnings per share (EPS) of ₹181 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The consensus price target rose 14% to ₹7,514despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Persistent Systems' earnings by assigning a price premium. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Persistent Systems, with the most bullish analyst valuing it at ₹9,970 and the most bearish at ₹3,350 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 Persistent Systems' past performance and to peers in the same industry. It's pretty clear that there is an expectation that Persistent Systems' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 16% growth on an annualised basis. This is compared to a historical growth rate of 24% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 8.4% annually. Even after the forecast slowdown in growth, it seems obvious that Persistent Systems is also expected to grow faster than the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Persistent Systems going out to 2026, and you can see them free on our platform here.

We also provide an overview of the Persistent Systems Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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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.