Earnings Miss: Okuma Corporation Missed EPS By 36% And Analysts Are Revising Their Forecasts

Okuma Corporation (TSE:6103) missed earnings with its latest quarterly results, disappointing overly-optimistic forecasters. Unfortunately, Okuma delivered a serious earnings miss. Revenues of JP¥45b were 14% below expectations, and statutory earnings per share of JP¥80.46 missed estimates by 36%. 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 Okuma after the latest results.

Check out our latest analysis for Okuma

Taking into account the latest results, the four analysts covering Okuma provided consensus estimates of JP¥218.1b revenue in 2025, which would reflect a perceptible 2.1% decline over the past 12 months. Statutory earnings per share are forecast to reduce 5.3% to JP¥537 in the same period. Before this earnings report, the analysts had been forecasting revenues of JP¥218.9b and earnings per share (EPS) of JP¥563 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 was broadly unchanged at JP¥6,993, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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. The most optimistic Okuma analyst has a price target of JP¥7,870 per share, while the most pessimistic values it at JP¥6,000. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Okuma's past performance and to peers in the same industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 2.7% by the end of 2025. This indicates a significant reduction from annual growth of 7.7% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 4.9% per year. It's pretty clear that Okuma's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Okuma. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at JP¥6,993, with the latest estimates not enough to have an impact on their price targets.

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 estimates - from multiple Okuma analysts - going out to 2027, and you can see them free on our platform here.

Even so, be aware that Okuma 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.