TOTO LTD. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

TOTO LTD. (TSE:5332) shareholders are probably feeling a little disappointed, since its shares fell 4.9% to JP¥3,749 in the week after its latest first-quarter results. Revenues were JP¥166b, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at JP¥37.32, an impressive 265% ahead of estimates. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

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Taking into account the latest results, the current consensus from TOTO's nine analysts is for revenues of JP¥742.8b in 2026. This would reflect an okay 2.4% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to bounce 218% to JP¥187. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥745.4b and earnings per share (EPS) of JP¥188 in 2026. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

View our latest analysis for TOTO

There were no changes to revenue or earnings estimates or the price target of JP¥4,201, suggesting that the company has met expectations in its recent result. 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. There are some variant perceptions on TOTO, with the most bullish analyst valuing it at JP¥5,100 and the most bearish at JP¥3,600 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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. We would highlight that TOTO's revenue growth is expected to slow, with the forecast 3.2% annualised growth rate until the end of 2026 being well below the historical 5.2% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 3.8% annually. Factoring in the forecast slowdown in growth, it seems obvious that TOTO is also expected to grow slower than other industry participants.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for TOTO going out to 2028, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 3 warning signs for TOTO that you should be aware 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.