Earnings Miss: Toyota Industries Corporation Missed EPS By 26% And Analysts Are Revising Their Forecasts

Last week, you might have seen that Toyota Industries Corporation (TSE:6201) released its half-year result to the market. The early response was not positive, with shares down 8.2% to JP¥10,205 in the past week. Statutory earnings per share fell badly short of expectations, coming in at JP¥119, some 26% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at JP¥2.0t. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Toyota Industries

Following last week's earnings report, Toyota Industries' 14 analysts are forecasting 2025 revenues to be JP¥4.07t, approximately in line with the last 12 months. Per-share earnings are expected to climb 16% to JP¥902. In the lead-up to this report, the analysts had been modelling revenues of JP¥4.07t and earnings per share (EPS) of JP¥924 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 minor downgrade to their earnings per share forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at JP¥13,329, 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. There are some variant perceptions on Toyota Industries, with the most bullish analyst valuing it at JP¥16,600 and the most bearish at JP¥11,100 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Toyota Industries' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 3.0% growth on an annualised basis. This is compared to a historical growth rate of 15% 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 4.8% per year. Factoring in the forecast slowdown in growth, it seems obvious that Toyota Industries 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. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Toyota Industries' revenue is expected to 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 Toyota Industries. 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 Toyota Industries going out to 2027, and you can see them free on our platform here..

You still need to take note of risks, for example - Toyota Industries has 2 warning signs we think you should be aware of.

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

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.