Namura Shipbuilding Co., Ltd. Just Missed Earnings - But Analysts Have Updated Their Models
It's shaping up to be a tough period for Namura Shipbuilding Co., Ltd. (TSE:7014), which a week ago released some disappointing interim results that could have a notable impact on how the market views the stock. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at JP¥39b, statutory earnings missed forecasts by an incredible 24%, coming in at just JP¥67.97 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'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, Namura Shipbuilding's two analysts are forecasting 2027 revenues to be JP¥172.4b, approximately in line with the last 12 months. Statutory earnings per share are forecast to dip 2.2% to JP¥358 in the same period. In the lead-up to this report, the analysts had been modelling revenues of JP¥173.8b and earnings per share (EPS) of JP¥373 in 2027. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.
View our latest analysis for Namura Shipbuilding
It might be a surprise to learn that the consensus price target was broadly unchanged at JP¥5,900, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation.
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. We would highlight that Namura Shipbuilding's revenue growth is expected to slow, with the forecast 4.0% annualised growth rate until the end of 2027 being well below the historical 13% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.7% annually. Factoring in the forecast slowdown in growth, it seems obvious that Namura Shipbuilding is also expected to grow slower than other industry participants.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Namura Shipbuilding's revenue is expected to perform worse than the wider industry. The consensus price target held steady at JP¥5,900, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on Namura Shipbuilding. Long-term earnings power is much more important than next year's profits. At least one analyst has provided forecasts out to 2029, which can be seen for free on our platform here.
You still need to take note of risks, for example - Namura Shipbuilding has 1 warning sign we think you should be aware of.
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