Sumitomo Heavy Industries, Ltd. (TSE:6302) Half-Yearly Results: Here's What Analysts Are Forecasting For This Year

Sumitomo Heavy Industries, Ltd. (TSE:6302) last week reported its latest half-year results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. It was a workmanlike result, with revenues of JP¥495b coming in 2.0% ahead of expectations, and statutory earnings per share of JP¥63.86, in line with analyst appraisals. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Following last week's earnings report, Sumitomo Heavy Industries' four analysts are forecasting 2025 revenues to be JP¥1.04t, approximately in line with the last 12 months. Sumitomo Heavy Industries is also expected to turn profitable, with statutory earnings of JP¥230 per share. Before this earnings report, the analysts had been forecasting revenues of JP¥1.06t and earnings per share (EPS) of JP¥274 in 2025. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a substantial drop in EPS estimates.

See our latest analysis for Sumitomo Heavy Industries

The consensus price target held steady at JP¥3,220, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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. There are some variant perceptions on Sumitomo Heavy Industries, with the most bullish analyst valuing it at JP¥3,800 and the most bearish at JP¥2,900 per share. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Sumitomo Heavy Industries is an easy business to forecast or the the analysts are all using similar assumptions.

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 revenue is expected to reverse, with a forecast 1.0% annualised decline to the end of 2025. That is a notable change from historical growth of 5.5% 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 4.7% per year. It's pretty clear that Sumitomo Heavy Industries' 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 Sumitomo Heavy Industries. 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¥3,220, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Sumitomo Heavy Industries going out to 2027, and you can see them free on our platform here.

It is also worth noting that we have found 1 warning sign for Sumitomo Heavy Industries that you need to take into consideration.

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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.