Tata Consultancy Services Limited (NSE:TCS) Just Released Its Annual Results And Analysts Are Updating Their Estimates

The annual results for Tata Consultancy Services Limited (NSE:TCS) were released last week, making it a good time to revisit its performance. It was a credible result overall, with revenues of ₹2.4t and statutory earnings per share of ₹126 both in line with analyst estimates, showing that Tata Consultancy Services is executing in line with expectations. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Tata Consultancy Services

After the latest results, the 45 analysts covering Tata Consultancy Services are now predicting revenues of ₹2.60t in 2025. If met, this would reflect a reasonable 8.0% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to swell 12% to ₹142. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹2.60t and earnings per share (EPS) of ₹142 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

There were no changes to revenue or earnings estimates or the price target of ₹4,191, suggesting that the company has met expectations in its recent result. 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. Currently, the most bullish analyst values Tata Consultancy Services at ₹4,787 per share, while the most bearish prices it at ₹3,040. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Tata Consultancy Services' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 8.0% growth on an annualised basis. This is compared to a historical growth rate of 11% over the past five years. Compare this to the 130 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 7.3% per year. So it's pretty clear that, while Tata Consultancy Services' revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as 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.

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. At Simply Wall St, we have a full range of analyst estimates for Tata Consultancy Services going out to 2027, and you can see them free on our platform here..

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with Tata Consultancy Services , and understanding it should be part of your investment process.

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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.