Brokerages turn less bullish on TCS after company misses revenue forecasts

Brokerages have turned less bullish on Tata Consultancy Services (TCS) after the IT services company missed revenue and margins forecasts for the quarter ended June.

The number of ‘buy’ ratings for the stock has reduced from 27 to 23, while ‘sell’ calls have increased from 7 to 9. The average 12-month price target has also seen a slight reduction.

The stock fell as much as 3 per cent in intra-day trade on Wednesday. Valuation of TCS at 21x its estimated FY21  earnings is expensive, compared to its peers.

Analysts say the lofty valuations leave little room for disappointment. Shares of TCS on Wednesday ended at Rs 2,108, down 1.1 per cent.