Analysts Just Shaved Their GMR Airports Infrastructure Limited (NSE:GMRINFRA) Forecasts Dramatically

Market forces rained on the parade of GMR Airports Infrastructure Limited (NSE:GMRINFRA) shareholders today, when the analysts downgraded their forecasts for this year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business.

Following the downgrade, the latest consensus from GMR Airports Infrastructure's twin analysts is for revenues of ₹85b in 2024, which would reflect a solid 10% improvement in sales compared to the last 12 months. Losses are forecast to hold steady at around ₹0.60 per share. Yet prior to the latest estimates, the analysts had been forecasting revenues of ₹102b and losses of ₹0.20 per share in 2024. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a serious cut to their revenue forecasts while also expecting losses per share to increase.

Check out our latest analysis for GMR Airports Infrastructure

Analysts lifted their price target 7.3% to ₹59.00, implicitly signalling that lower earnings per share are not expected to have a longer-term impact on the stock's value.

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. One thing stands out from these estimates, which is that GMR Airports Infrastructure is forecast to grow faster in the future than it has in the past, with revenues expected to display 22% annualised growth until the end of 2024. If achieved, this would be a much better result than the 4.5% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 13% per year. So it looks like GMR Airports Infrastructure is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The most important thing to note from this downgrade is that the consensus increased its forecast losses this year, suggesting all may not be well at GMR Airports Infrastructure. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. The rising price target is a puzzle, but still - with a serious cut to this year's outlook, we wouldn't be surprised if investors were a bit wary of GMR Airports Infrastructure.

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 2026, which can be seen for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.