Update shared on 07 Nov 2025
Fair value Increased 15%Narrative Update on IHI Analyst Price Target
Analysts have raised their price target on IHI from ¥2,626 to ¥3,023, citing improved revenue growth and a better margin outlook, but noting that valuation concerns temper further upside.
Analyst Commentary
Recent research activity on IHI highlights a mix of optimism and caution among market observers, reflecting ongoing debates around the company's growth prospects and valuation.
Bullish Takeaways- Bullish analysts point to robust revenue growth, supported by positive margin trends that suggest the company's core businesses are performing well.
- The increase in price targets indicates confidence in IHI's operational execution and improved earnings outlook.
- Long-term industry fundamentals are seen as supportive. IHI is positioned to capitalize on sector demand and continued innovation.
- Some analysts have turned more cautious on valuation, arguing that the stock’s recent climb leaves limited near-term upside.
- The possibility of execution risks remains. Any setbacks could impact profitability and may justify a more neutral stance.
- Current market prices may already reflect much of the anticipated growth, which could make further gains harder to achieve without new positive catalysts.
What's in the News
- IHI Corporation revised its consolidated earnings guidance for the fiscal year ending March 31, 2026. Revenue is expected at JPY 1,640,000 million, and basic earnings per share are projected to be JPY 117.49 (Key Developments).
- The company announced a cash dividend of JPY 70.00 per share for the second quarter ended September 30, 2025. This is up from JPY 50.00 per share a year ago and will be payable on December 5, 2025 (Key Developments).
- IHI Corporation (TSE:7013) was added to major indices, including the S&P Global 1200, S&P International 700, and S&P TOPIX (Key Developments).
- IHI Corporation (TSE:7013) was removed from the S&P Japan Mid Cap 100 (Key Developments).
Valuation Changes
- Fair Value: Increased from ¥2,626 to ¥3,023, reflecting a higher assessment of intrinsic worth.
- Discount Rate: Increased slightly from 6.54% to 6.70%, indicating a modestly higher perceived risk or cost of capital.
- Revenue Growth: Rose from 5.47% to 5.71%, signifying a more optimistic outlook for top-line expansion.
- Net Profit Margin: Improved from 7.55% to 7.77%, suggesting enhanced earnings efficiency.
- Future P/E: Increased from 23.48x to 26.22x, implying a higher valuation on projected earnings.
Disclaimer
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