Nissin Foods Company Limited Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Investors in Nissin Foods Company Limited (HKG:1475) had a good week, as its shares rose 5.0% to close at HK$6.14 following the release of its full-year results. Statutory earnings per share fell badly short of expectations, coming in at HK$0.19, some 38% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at HK$3.8b. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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Taking into account the latest results, the consensus forecast from Nissin Foods' four analysts is for revenues of HK$4.21b in 2025. This reflects a decent 10% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to shoot up 74% to HK$0.34. Before this earnings report, the analysts had been forecasting revenues of HK$4.13b and earnings per share (EPS) of HK$0.36 in 2025. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

See our latest analysis for Nissin Foods

Despite cutting their earnings forecasts,the analysts have lifted their price target 5.5% to HK$6.33, suggesting that these impacts are not expected to weigh on the stock's value in the long term. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Nissin Foods analyst has a price target of HK$7.00 per share, while the most pessimistic values it at HK$5.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Nissin Foods shareholders.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that Nissin Foods' rate of growth is expected to accelerate meaningfully, with the forecast 10% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 3.3% p.a. 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 4.7% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Nissin Foods 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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Nissin Foods analysts - going out to 2027, 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 Nissin Foods that you need to be mindful of.

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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.