Toyobo Co., Ltd. (TSE:3101) Just Reported Half-Yearly Earnings: Have Analysts Changed Their Mind On The Stock?
It's been a good week for Toyobo Co., Ltd. (TSE:3101) shareholders, because the company has just released its latest half-yearly results, and the shares gained 2.7% to JP¥1,535. Results overall were respectable, with statutory earnings of JP¥127 per share roughly in line with what the analysts had forecast. Revenues of JP¥218b came in 3.5% ahead of analyst predictions. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Following last week's earnings report, Toyobo's three analysts are forecasting 2027 revenues to be JP¥442.8b, approximately in line with the last 12 months. Statutory earnings per share are expected to shrink 8.3% to JP¥91.90 in the same period. Before this earnings report, the analysts had been forecasting revenues of JP¥442.9b and earnings per share (EPS) of JP¥104 in 2027. So there's definitely been a decline in sentiment after the latest results, noting the substantial drop in new EPS forecasts.
View our latest analysis for Toyobo
The consensus price target held steady at JP¥2,100, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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 Toyobo at JP¥2,500 per share, while the most bearish prices it at JP¥1,700. 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 Toyobo shareholders.
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. The period to the end of 2027 brings more of the same, according to the analysts, with revenue forecast to display 3.2% growth on an annualised basis. That is in line with its 3.0% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 5.4% per year. So although Toyobo is expected to maintain its revenue growth rate, it's forecast to grow slower than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Toyobo. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Toyobo's revenue is expected to perform worse than the wider industry. The consensus price target held steady at JP¥2,100, with the latest estimates not enough to have an impact on their price targets.
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 estimates - from multiple Toyobo analysts - going out to 2029, and you can see them free on our platform here.
Even so, be aware that Toyobo is showing 2 warning signs in our investment analysis , and 1 of those is a bit unpleasant...
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