Here's What Analysts Are Forecasting For Nabtesco Corporation (TSE:6268) After Its First-Quarter Results

Shareholders of Nabtesco Corporation (TSE:6268) will be pleased this week, given that the stock price is up 10% to JP¥2,827 following its latest quarterly results. Results were roughly in line with estimates, with revenues of JP¥72b and statutory earnings per share of JP¥121. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Nabtesco

Taking into account the latest results, Nabtesco's ten analysts currently expect revenues in 2024 to be JP¥320.2b, approximately in line with the last 12 months. Statutory earnings per share are expected to dip 7.0% to JP¥81.33 in the same period. Before this earnings report, the analysts had been forecasting revenues of JP¥320.1b and earnings per share (EPS) of JP¥75.74 in 2024. So the consensus seems to have become somewhat more optimistic on Nabtesco's earnings potential following these results.

The consensus price target was unchanged at JP¥2,770, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Nabtesco analyst has a price target of JP¥3,500 per share, while the most pessimistic values it at JP¥2,200. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that revenue is expected to reverse, with a forecast 1.4% annualised decline to the end of 2024. That is a notable change from historical growth of 3.0% 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. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Nabtesco is expected to lag the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Nabtesco 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 said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Nabtesco analysts - going out to 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 4 warning signs for Nabtesco you should be aware of, and 1 of them is a bit concerning.

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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.