Results: Ricoh Company, Ltd. Exceeded Expectations And The Consensus Has Updated Its Estimates

Ricoh Company, Ltd. (TSE:7752) shareholders are probably feeling a little disappointed, since its shares fell 6.1% to JP¥1,674 in the week after its latest interim results. It looks like a credible result overall - although revenues of JP¥1.3t were what the analysts expected, Ricoh Company surprised by delivering a (statutory) profit of JP¥98.77 per share, an impressive 315% above what was forecast. 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 Ricoh Company after the latest results.

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Following last week's earnings report, Ricoh Company's nine analysts are forecasting 2027 revenues to be JP¥2.66t, approximately in line with the last 12 months. Statutory earnings per share are forecast to plunge 20% to JP¥122 in the same period. In the lead-up to this report, the analysts had been modelling revenues of JP¥2.67t and earnings per share (EPS) of JP¥122 in 2027. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

Check out our latest analysis for Ricoh Company

The analysts reconfirmed their price target of JP¥1,503, showing that the business is executing well and in line with expectations. 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. The most optimistic Ricoh Company analyst has a price target of JP¥1,800 per share, while the most pessimistic values it at JP¥1,300. 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.

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 revenue is expected to reverse, with a forecast 1.2% annualised decline to the end of 2027. That is a notable change from historical growth of 8.9% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 3.1% annually for the foreseeable future. It's pretty clear that Ricoh Company's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. 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. We have forecasts for Ricoh Company going out to 2029, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for Ricoh Company (1 is a bit concerning!) that you need to be mindful of.

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