The analysts might have been a bit too bullish on IDP Education Limited (ASX:IEL), given that the company fell short of expectations when it released its half-year results last week. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at AU$475m, statutory earnings missed forecasts by an incredible 22%, coming in at just AU$0.21 per share. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for IDP Education

Following last week's earnings report, IDP Education's 13 analysts are forecasting 2025 revenues to be AU$938.9m, approximately in line with the last 12 months. Per-share earnings are expected to rise 4.0% to AU$0.36. Yet prior to the latest earnings, the analysts had been anticipated revenues of AU$972.4m and earnings per share (EPS) of AU$0.46 in 2025. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a pretty serious reduction to earnings per share estimates.

The consensus price target fell 12% to AU$15.94, with the weaker earnings outlook clearly leading valuation estimates. 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. Currently, the most bullish analyst values IDP Education at AU$22.00 per share, while the most bearish prices it at AU$9.50. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that IDP Education's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 1.2% growth on an annualised basis. This is compared to a historical growth rate of 15% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 9.0% per year. Factoring in the forecast slowdown in growth, it seems obvious that IDP Education is also expected to grow slower than other industry participants.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for IDP Education. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of IDP Education's future valuation.

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 IDP Education going out to 2027, and you can see them free on our platform here..

We don't want to rain on the parade too much, but we did also find 2 warning signs for IDP Education that you need to be mindful of.

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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.