Sterling and Wilson Renewable Energy Limited (NSE:SWSOLAR) shareholders are probably feeling a little disappointed, since its shares fell 6.1% to ₹222 in the week after its latest first-quarter results. Revenues were ₹16b, and Sterling and Wilson Renewable Energy was a dismal 11% short of estimates. This is an important time for investors, as they can track a company’s performance in its report, look at <a href="https://absafricatv.com/what-are-mashaba-and-malema-hiding/” title=”What are Mashaba and Malema hiding?”>what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we’ve aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Sterling and Wilson Renewable Energy after the latest results.
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Following the latest results, Sterling and Wilson Renewable Energy’s two analysts are now forecasting revenues of ₹86.4b in 2027. This would be a solid 17% improvement in revenue compared to the last 12 months. Sterling and Wilson Renewable Energy is also expected to turn profitable, with statutory earnings of ₹12.50 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹90.1b and earnings per share (EPS) of ₹13.25 in 2027. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the small dip in earnings per share expectations.
Check out our latest analysis for Sterling and Wilson Renewable Energy
The analysts made no major changes to their price target of ₹293, suggesting the downgrades are not expected to have a long-term impact on Sterling and Wilson Renewable Energy’s valuation.
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 Sterling and Wilson Renewable Energy’s rate of growth is expected to accelerate meaningfully, with the forecast 23% annualised revenue growth to the end of 2027 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 13% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Sterling and Wilson Renewable Energy to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. They also downgraded Sterling and Wilson Renewable Energy’s revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. The consensus price target held steady at ₹293, 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 Sterling and Wilson Renewable Energy. Long-term earnings power is much more important than next year’s profits. At least one analyst has provided forecasts out to 2028, which can be seen for free on our platform here.
You can also view our analysis of Sterling and Wilson Renewable Energy’s balance sheet, and whether we think Sterling and Wilson Renewable Energy is carrying too much debt, for free on our platform here.
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Have feedback on this article? Concerned about the content?Get in touchwith 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.
About NSEI:SWSOLAR
Sterling and Wilson Renewable Energy
Provides renewable engineering, procurement, and construction (EPC) services in India, Europe, the Middle East, North Africa, rest of Africa, the United States, Latin America, and Australia.
High growth potential and fair value.
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