Shin-Etsu Chemical Co., Ltd. (TSE:4063) First-Quarter Results Just Came Out: Here's What Analysts Are Forecasting For This Year
It's been a sad week for Shin-Etsu Chemical Co., Ltd. (TSE:4063), who've watched their investment drop 19% to JP¥5,872 in the week since the company reported its quarterly result. Results look mixed - while revenue fell marginally short of analyst estimates at JP¥662b, statutory earnings beat expectations 4.0%, with Shin-Etsu Chemical reporting profits of JP¥70.39 per share. 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the consensus forecast from Shin-Etsu Chemical's 18 analysts is for revenues of JP¥2.79t in 2027. This reflects a credible 7.0% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to step up 19% to JP¥306. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥2.85t and earnings per share (EPS) of JP¥310 in 2027. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
See our latest analysis for Shin-Etsu Chemical
The analysts reconfirmed their price target of JP¥8,069, showing that the business is executing well and in line with expectations. 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 Shin-Etsu Chemical at JP¥9,510 per share, while the most bearish prices it at JP¥6,900. 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.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Shin-Etsu Chemical's rate of growth is expected to accelerate meaningfully, with the forecast 9.5% annualised revenue growth to the end of 2027 noticeably faster than its historical growth of 5.6% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.3% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Shin-Etsu Chemical is expected to grow much faster than its industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. 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¥8,069, 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 Shin-Etsu Chemical going out to 2029, and you can see them free on our platform here..
Before you take the next step you should know about the 2 warning signs for Shin-Etsu Chemical that we have uncovered.
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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.