Here's What Analysts Are Forecasting For Terumo Corporation (TSE:4543) After Its Half-Year Results
Terumo Corporation (TSE:4543) just released its half-year report and things are looking bullish. Revenues and losses per share were both better than expected, with revenues of JP¥625b leading estimates by 2.3%. Statutory losses were smaller than the analystsexpected, coming in at JP¥10.72 per share. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Following last week's earnings report, Terumo's 13 analysts are forecasting 2027 revenues to be JP¥1.23t, approximately in line with the last 12 months. Statutory per-share earnings are expected to be JP¥76.76, roughly flat on the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥1.25t and earnings per share (EPS) of JP¥82.38 in 2027. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.
See our latest analysis for Terumo
It might be a surprise to learn that the consensus price target was broadly unchanged at JP¥2,970, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Terumo, with the most bullish analyst valuing it at JP¥3,400 and the most bearish at JP¥2,600 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Terumo's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Terumo's revenue growth will slow down substantially, with revenues to the end of 2027 expected to display 2.0% growth on an annualised basis. This is compared to a historical growth rate of 12% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 6.7% per year. Factoring in the forecast slowdown in growth, it seems obvious that Terumo 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. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse 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.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Terumo going out to 2029, and you can see them free on our platform here..
Before you take the next step you should know about the 1 warning sign for Terumo that we have uncovered.
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