Mitsubishi Motors Corporation Just Missed EPS By 41%: Here's What Analysts Think Will Happen Next

The analysts might have been a bit too bullish on Mitsubishi Motors Corporation (TSE:7211), given that the company fell short of expectations when it released its interim results last week. Results showed a clear earnings miss, with JP¥1.3t revenue coming in 3.2% lower than what the analystsexpected. Statutory earnings per share (EPS) of JP¥25.52 missed the mark badly, arriving some 41% below what was expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Mitsubishi Motors

Taking into account the latest results, Mitsubishi Motors' twelve analysts currently expect revenues in 2025 to be JP¥2.78t, approximately in line with the last 12 months. Per-share earnings are expected to accumulate 3.2% to JP¥86.82. Before this earnings report, the analysts had been forecasting revenues of JP¥2.81t and earnings per share (EPS) of JP¥89.22 in 2025. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

The consensus price target held steady at JP¥463, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Mitsubishi Motors at JP¥560 per share, while the most bearish prices it at JP¥370. 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 Mitsubishi Motors shareholders.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Mitsubishi Motors' past performance and to peers in the same industry. It's pretty clear that there is an expectation that Mitsubishi Motors' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 1.0% growth on an annualised basis. This is compared to a historical growth rate of 7.9% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 2.8% per year. Factoring in the forecast slowdown in growth, it seems obvious that Mitsubishi Motors is also expected to grow slower than other industry participants.

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. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Mitsubishi Motors. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Mitsubishi Motors going out to 2027, and you can see them free on our platform here..

Even so, be aware that Mitsubishi Motors is showing 1 warning sign in our investment analysis , you should know about...

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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.