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7731: Earnings Headwinds Will Persist As Guidance Cuts Offset Modest Outlook Improvements

Acquisition Of RED And Growth In Cell Therapy Propel Revenue And Margins In Imaging And Healthcare

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7731
AnalystConsensusTarget
Not Invested
Published 17 Dec 2024

Update shared on 20 Dec 2025

Fair value Increased 2.35%
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AnalystConsensusTarget's Fair Value
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1Y
6.0%
7D
-1.9%

Analysts have modestly raised their price target on Nikon, reflecting a slightly higher implied fair value of approximately ¥1,582 per share, up from about ¥1,546. This change is supported by expectations of marginally richer future valuation multiples, while growth and profitability assumptions remain essentially stable.

What's in the News

  • Nikon raised its earnings guidance for the first half of fiscal 2025, now expecting net sales of JPY 313 billion and narrowing its projected operating loss to JPY 5 billion, helped by FX tailwinds and earlier than planned gains in its Precision Equipment Business (company guidance).
  • Full year fiscal 2026 guidance was revised downward. Nikon cut its net sales forecast to JPY 680 billion and operating profit to JPY 14 billion, citing weaker demand in Precision Equipment and Digital Manufacturing and anticipated U.S. tariff impacts (company guidance).
  • Nikon and Healios K.K. agreed to terminate their business and capital alliance formed in 2017. Both firms chose to pursue independent strategies in regenerative medicine as Healios shifts toward a CDMO model from 2025 (company announcement).
  • Nikon reaffirmed availability of its DSP-100 Digital Lithography System, designed for advanced semiconductor packaging on large 600mm substrates. The company highlighted high resolution, maskless operation, and improved throughput ahead of its showcase at SEMICON West 2025 (product announcement).

Valuation Changes

  • Fair Value Estimate: has risen slightly from approximately ¥1,546 per share to about ¥1,582 per share.
  • Discount Rate: has increased marginally from about 7.45 percent to roughly 7.50 percent, implying a slightly higher required return.
  • Revenue Growth: has edged down from an assumed long term rate of around 3.10 percent to about 3.08 percent.
  • Net Profit Margin: has eased slightly from roughly 5.87 percent to about 5.85 percent, indicating a modestly more conservative profitability outlook.
  • Future P/E: has risen modestly from about 12.8x to roughly 13.2x, reflecting a small uplift in the assumed valuation multiple.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.