The Tata Consultancy Services Limited (NSE:TCS) Annual Results Are Out And Analysts Have Published New Forecasts

The yearly results for Tata Consultancy Services Limited (NSE:TCS) were released last week, making it a good time to revisit its performance. Results were roughly in line with estimates, with revenues of ₹2.6t and statutory earnings per share of ₹134. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

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Following the latest results, Tata Consultancy Services' 45 analysts are now forecasting revenues of ₹2.66t in 2026. This would be a reasonable 4.0% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to increase 6.7% to ₹143. In the lead-up to this report, the analysts had been modelling revenues of ₹2.66t and earnings per share (EPS) of ₹143 in 2026. 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.

See our latest analysis for Tata Consultancy Services

It will come as no surprise then, to learn that the consensus price target is largely unchanged at ₹3,828. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Tata Consultancy Services analyst has a price target of ₹5,230 per share, while the most pessimistic values it at ₹3,000. 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.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. 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 2026 expected to display 4.0% growth on an annualised basis. This is compared to a historical growth rate of 11% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.4% 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 Tata Consultancy Services.

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, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Tata Consultancy Services' revenue is expected to perform worse than the wider industry. The consensus price target held steady at ₹3,828, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Tata Consultancy Services. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Tata Consultancy Services analysts - going out to 2028, and you can see them free on our platform here.

It is also worth noting that we have found 1 warning sign for Tata Consultancy Services that you need to take into consideration.

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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.