Nissan Motor Co., Ltd. Just Missed Earnings - But Analysts Have Updated Their Models

Nissan Motor Co., Ltd. (TSE:7201) just released its latest quarterly report and things are not looking great. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at JP¥3.0t, statutory earnings missed forecasts by an incredible 72%, coming in at just JP¥7.77 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Nissan Motor after the latest results.

See our latest analysis for Nissan Motor

Taking into account the latest results, the most recent consensus for Nissan Motor from 15 analysts is for revenues of JP¥13t in 2025. If met, it would imply a satisfactory 4.9% increase on its revenue over the past 12 months. Statutory per-share earnings are expected to be JP¥96.72, roughly flat on the last 12 months. Before this earnings report, the analysts had been forecasting revenues of JP¥13t and earnings per share (EPS) of JP¥101 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

It might be a surprise to learn that the consensus price target fell 6.2% to JP¥588, with the analysts clearly linking lower forecast earnings to the performance of the stock price. 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. There are some variant perceptions on Nissan Motor, with the most bullish analyst valuing it at JP¥1,010 and the most bearish at JP¥410 per share. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Nissan Motor's past performance and to peers in the same industry. It's clear from the latest estimates that Nissan Motor's rate of growth is expected to accelerate meaningfully, with the forecast 6.5% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 5.2% 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 3.6% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Nissan Motor is expected to grow much faster than its 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. 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. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

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 Nissan Motor 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 Nissan Motor (1 is concerning!) 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com