Rinnai Corporation Just Recorded A 16% EPS Beat: Here's What Analysts Are Forecasting Next
Rinnai Corporation (TSE:5947) just released its quarterly report and things are looking bullish. Rinnai delivered a significant beat with revenue hitting JP¥114b and statutory EPS reaching JP¥48.85, both beating estimates by more than 10%. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Rinnai after the latest results.
After the latest results, the eight analysts covering Rinnai are now predicting revenues of JP¥502.0b in 2027. If met, this would reflect a modest 4.3% improvement in revenue compared to the last 12 months. Statutory per share are forecast to be JP¥260, approximately in line with the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥500.5b and earnings per share (EPS) of JP¥259 in 2027. 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.
Check out our latest analysis for Rinnai
It will come as no surprise then, to learn that the consensus price target is largely unchanged at JP¥4,359. 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 Rinnai, with the most bullish analyst valuing it at JP¥5,000 and the most bearish at JP¥4,100 per share. This is a very narrow spread of estimates, implying either that Rinnai is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
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. The period to the end of 2027 brings more of the same, according to the analysts, with revenue forecast to display 5.8% growth on an annualised basis. That is in line with its 5.8% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 3.4% annually. So it's pretty clear that Rinnai is forecast to grow substantially faster than its industry.
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. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is 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.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Rinnai going out to 2029, and you can see them free on our platform here.
Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.
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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.