Kikkoman Corporation Just Beat EPS By 16%: Here's What Analysts Think Will Happen Next
Kikkoman Corporation (TSE:2801) shareholders are probably feeling a little disappointed, since its shares fell 7.1% to JP¥1,672 in the week after its latest half-yearly results. It looks like a credible result overall - although revenues of JP¥405b were in line with what the analysts predicted, Kikkoman surprised by delivering a statutory profit of JP¥20.75 per share, a notable 16% above expectations. 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.
After the latest results, the twelve analysts covering Kikkoman are now predicting revenues of JP¥819.7b in 2027. If met, this would reflect a reasonable 3.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to dip 4.0% to JP¥71.00 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥817.7b and earnings per share (EPS) of JP¥71.38 in 2027. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
View our latest analysis for Kikkoman
It will come as no surprise then, to learn that the consensus price target is largely unchanged at JP¥1,896. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Kikkoman analyst has a price target of JP¥2,200 per share, while the most pessimistic values it at JP¥1,500. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
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. It's pretty clear that there is an expectation that Kikkoman's revenue growth will slow down substantially, with revenues to the end of 2027 expected to display 7.0% growth on an annualised basis. This is compared to a historical growth rate of 9.0% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 3.9% per year. So it's pretty clear that, while Kikkoman's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, there were no major changes to revenue forecasts, with the business still 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 Kikkoman going out to 2029, and you can see them free on our platform here.
You can also see our analysis of Kikkoman's Board and CEO remuneration and experience, and whether company insiders have been buying stock.
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