Subaru Corporation Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now
Subaru Corporation (TSE:7270) shareholders are probably feeling a little disappointed, since its shares fell 5.5% to JP¥2,568 in the week after its latest quarterly results. It looks like a pretty bad result, all things considered. Although revenues of JP¥1.3t were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 29% to hit JP¥69.02 per share. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the most recent consensus for Subaru from 15 analysts is for revenues of JP¥5.15t in 2027. If met, it would imply a reasonable 6.8% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to surge 102% to JP¥244. Before this earnings report, the analysts had been forecasting revenues of JP¥5.13t and earnings per share (EPS) of JP¥238 in 2027. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
See our latest analysis for Subaru
The consensus price target was unchanged at JP¥2,730, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 Subaru at JP¥3,650 per share, while the most bearish prices it at JP¥2,200. 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 Subaru shareholders.
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 Subaru's revenue growth is expected to slow, with the forecast 9.1% annualised growth rate until the end of 2027 being well below the historical 12% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 3.2% per year. So it's pretty clear that, while Subaru'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 here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Subaru following these results. 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. At Simply Wall St, we have a full range of analyst estimates for Subaru going out to 2029, and you can see them free on our platform here..
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Subaru (at least 1 which is a bit concerning) , and understanding these should be part of your investment process.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.