Just In: One Analyst Has Become A Lot More Bullish On RailTel Corporation of India Limited's (NSE:RAILTEL) Earnings

RailTel Corporation of India Limited (NSE:RAILTEL) shareholders will have a reason to smile today, with the covering analyst making substantial upgrades to this year's forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects.

Following the upgrade, the current consensus from RailTel Corporation of India's sole analyst is for revenues of ₹24b in 2024 which - if met - would reflect a sizeable 21% increase on its sales over the past 12 months. Per-share earnings are expected to bounce 34% to ₹7.90. Before this latest update, the analyst had been forecasting revenues of ₹22b and earnings per share (EPS) of ₹6.98 in 2024. There has definitely been an improvement in perception recently, with the analyst substantially increasing both their earnings and revenue estimates.

Check out our latest analysis for RailTel Corporation of India

Despite these upgrades, the analyst has not made any major changes to their price target of ₹140, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that RailTel Corporation of India's rate of growth is expected to accelerate meaningfully, with the forecast 21% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 13% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 3.8% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analyst also expect RailTel Corporation of India to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that the analyst upgraded their earnings per share estimates, with improved earnings power expected for this year. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. The lack of change in the price target is puzzling, but with a serious upgrade to this year's earnings expectations, it might be time to take another look at RailTel Corporation of India.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2025, which can be seen for free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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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.