Tata Power Company Limited Just Missed Earnings - But Analysts Have Updated Their Models

Tata Power Company Limited (NSE:TATAPOWER) last week reported its latest full-year results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Revenues of ₹655b were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at ₹12.41, missing estimates by 8.7%. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Taking into account the latest results, the consensus forecast from Tata Power's 19 analysts is for revenues of ₹732.0b in 2026. This reflects a meaningful 12% improvement in revenue compared to the last 12 months. Per-share earnings are expected to shoot up 22% to ₹15.11. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹732.4b and earnings per share (EPS) of ₹15.30 in 2026. 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.

View our latest analysis for Tata Power

It will come as no surprise then, to learn that the consensus price target is largely unchanged at ₹420. 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 Tata Power, with the most bullish analyst valuing it at ₹560 and the most bearish at ₹265 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Tata Power's revenue growth is expected to slow, with the forecast 12% annualised growth rate until the end of 2026 being well below the historical 18% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 8.7% per year. So it's pretty clear that, while Tata Power's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than 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.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Tata Power analysts - going out to 2028, and you can see them free on our platform here.

Even so, be aware that Tata Power is showing 2 warning signs in our investment analysis , and 1 of those is significant...

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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.