MRF Limited (NSE:MRF) First-Quarter Results Just Came Out: Here's What Analysts Are Forecasting For This Year
Last week, you might have seen that MRF Limited (NSE:MRF) released its quarterly result to the market. The early response was not positive, with shares down 2.2% to ₹130,985 in the past week. Revenues came in 4.6% below expectations, at ₹84b. Statutory earnings per share were relatively better off, with a per-share profit of ₹5,720 being roughly in line with analyst estimates. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the consensus forecast from MRF's eight analysts is for revenues of ₹343.3b in 2027. This reflects an okay 7.6% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to sink 12% to ₹5,027 in the same period. In the lead-up to this report, the analysts had been modelling revenues of ₹351.5b and earnings per share (EPS) of ₹5,233 in 2027. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a minor downgrade to earnings per share estimates.
Check out our latest analysis for MRF
Despite the cuts to forecast earnings, there was no real change to the ₹139,208 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic MRF analyst has a price target of ₹165,238 per share, while the most pessimistic values it at ₹113,936. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await MRF shareholders.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the MRF's past performance and to peers in the same industry. The period to the end of 2027 brings more of the same, according to the analysts, with revenue forecast to display 10% growth on an annualised basis. That is in line with its 11% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 12% per year. It's clear that while MRF's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.
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. Sadly, they also downgraded their revenue forecasts, but the business is still expected to grow at roughly the same rate as the industry itself. The consensus price target held steady at ₹139,208, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for MRF going out to 2029, and you can see them free on our platform here..
You can also see our analysis of MRF's Board and CEO remuneration and experience, and whether company insiders have been buying stock.
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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.