Mitsubishi HC Capital Inc. Just Reported A Surprise Loss: Here's What Analysts Think Will Happen Next
Mitsubishi HC Capital Inc. (TSE:8593) came out with its interim results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Things were not great overall, with a surprise (statutory) loss of JP¥4.63 per share on revenues of JP¥571b, even though the analysts had been expecting a profit. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the most recent consensus for Mitsubishi HC Capital from six analysts is for revenues of JP¥2.29t in 2027. If met, it would imply a modest 4.1% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to bounce 63% to JP¥112. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥2.30t and earnings per share (EPS) of JP¥115 in 2027. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.
Check out our latest analysis for Mitsubishi HC Capital
The consensus price target held steady at JP¥1,458, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Mitsubishi HC Capital at JP¥1,620 per share, while the most bearish prices it at JP¥1,320. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Mitsubishi HC Capital is an easy business to forecast or the the analysts are all using similar assumptions.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Mitsubishi HC Capital's rate of growth is expected to accelerate meaningfully, with the forecast 8.3% annualised revenue growth to the end of 2027 noticeably faster than its historical growth of 6.8% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 1.5% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Mitsubishi HC Capital to grow faster than the wider industry.
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, 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. The consensus price target held steady at JP¥1,458, with the latest estimates not enough to have an impact on their price targets.
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 Mitsubishi HC Capital going out to 2029, and you can see them free on our platform here..
Even so, be aware that Mitsubishi HC Capital is showing 4 warning signs in our investment analysis , and 1 of those is potentially serious...
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