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Here's What Analysts Are Forecasting For Sumitomo Bakelite Company Limited (TSE:4203) After Its Half-Yearly Results
There's been a major selloff in Sumitomo Bakelite Company Limited (TSE:4203) shares in the week since it released its half-year report, with the stock down 22% to JP¥6,346. Results overall were respectable, with statutory earnings of JP¥320 per share roughly in line with what the analysts had forecast. Revenues of JP¥192b came in 2.9% ahead of analyst predictions. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Sumitomo Bakelite after the latest results.
Taking into account the latest results, the most recent consensus for Sumitomo Bakelite from eight analysts is for revenues of JP¥391.2b in 2027. If met, it would imply a decent 10% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to increase 5.8% to JP¥413. Before this earnings report, the analysts had been forecasting revenues of JP¥381.4b and earnings per share (EPS) of JP¥429 in 2027. So it's pretty clear consensus is mixed on Sumitomo Bakelite after the latest results; whilethe analysts lifted revenue numbers, they also administered a minor downgrade to per-share earnings expectations.
See our latest analysis for Sumitomo Bakelite
There's been no major changes to the price target of JP¥9,670, suggesting that the impact of higher forecast revenue and lower earnings won't result in a meaningful change to the business' valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Sumitomo Bakelite analyst has a price target of JP¥11,760 per share, while the most pessimistic values it at JP¥5,800. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
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 analysts are definitely expecting Sumitomo Bakelite's growth to accelerate, with the forecast 21% annualised growth to the end of 2027 ranking favourably alongside historical growth of 5.3% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 5.4% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Sumitomo Bakelite 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. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. The consensus price target held steady at JP¥9,670, 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. We have forecasts for Sumitomo Bakelite going out to 2029, and you can see them free on our platform here.
You should always think about risks though. Case in point, we've spotted 1 warning sign for Sumitomo Bakelite you should be aware of.
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