Yamaha Motor Co., Ltd. Just Missed EPS By 37%: Here's What Analysts Think Will Happen Next

It's been a good week for Yamaha Motor Co., Ltd. (TSE:7272) shareholders, because the company has just released its latest quarterly results, and the shares gained 5.7% to JP¥1,400. Statutory earnings per share fell badly short of expectations, coming in at JP¥23.64, some 37% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at JP¥628b. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Yamaha Motor after the latest results.

View our latest analysis for Yamaha Motor

Following the latest results, Yamaha Motor's twelve analysts are now forecasting revenues of JP¥2.72t in 2025. This would be a modest 6.2% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 27% to JP¥196. Before this earnings report, the analysts had been forecasting revenues of JP¥2.71t and earnings per share (EPS) of JP¥192 in 2025. So the consensus seems to have become somewhat more optimistic on Yamaha Motor's earnings potential following these results.

There's been no major changes to the consensus price target of JP¥1,500, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Yamaha Motor analyst has a price target of JP¥1,700 per share, while the most pessimistic values it at JP¥1,200. 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 Yamaha Motor shareholders.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Yamaha Motor's revenue growth is expected to slow, with the forecast 5.0% annualised growth rate until the end of 2025 being well below the historical 12% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 2.8% annually. Even after the forecast slowdown in growth, it seems obvious that Yamaha Motor is also expected to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Yamaha Motor's earnings potential next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at JP¥1,500, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Yamaha Motor. Long-term earnings power is much more important than next year's profits. We have forecasts for Yamaha Motor going out to 2026, and you can see them free on our platform here.

Even so, be aware that Yamaha Motor is showing 2 warning signs 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.