Tsumura & Co. Just Beat EPS By 20%: Here's What Analysts Think Will Happen Next
Tsumura & Co. (TSE:4540) last week reported its latest interim results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. It looks like a credible result overall - although revenues of JP¥103b were in line with what the analysts predicted, Tsumura surprised by delivering a statutory profit of JP¥131 per share, a notable 20% above expectations. 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. 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 consensus forecast from Tsumura's five analysts is for revenues of JP¥217.1b in 2027. This reflects a credible 5.3% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to shrink 9.2% to JP¥388 in the same period. Before this earnings report, the analysts had been forecasting revenues of JP¥215.1b and earnings per share (EPS) of JP¥375 in 2027. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
Check out our latest analysis for Tsumura
The consensus price target was unchanged at JP¥4,268, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Tsumura at JP¥5,440 per share, while the most bearish prices it at JP¥3,700. 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.
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. The period to the end of 2027 brings more of the same, according to the analysts, with revenue forecast to display 11% growth on an annualised basis. That is in line with its 10% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 3.5% annually. So it's pretty clear that Tsumura is forecast to grow substantially faster than its industry.
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 Tsumura 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. 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.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Tsumura analysts - going out to 2029, and you can see them free on our platform here.
However, before you get too enthused, we've discovered 2 warning signs for Tsumura (1 is concerning!) that you should be aware of.
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