Daikin Industries,Ltd. Just Missed EPS By 42%: Here's What Analysts Think Will Happen Next

It's been a mediocre week for Daikin Industries,Ltd. (TSE:6367) shareholders, with the stock dropping 11% to JP¥16,360 in the week since its latest quarterly results. It looks like a pretty bad result, all things considered. Although revenues of JP¥1.1t were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 42% to hit JP¥120 per share. 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 Daikin IndustriesLtd after the latest results.

See our latest analysis for Daikin IndustriesLtd

Taking into account the latest results, the current consensus from Daikin IndustriesLtd's 17 analysts is for revenues of JP¥4.95t in 2026. This would reflect a reasonable 4.8% increase on its revenue over the past 12 months. Per-share earnings are expected to swell 15% to JP¥998. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥4.93t and earnings per share (EPS) of JP¥1,014 in 2026. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at JP¥20,699. 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. The most optimistic Daikin IndustriesLtd analyst has a price target of JP¥25,000 per share, while the most pessimistic values it at JP¥16,000. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Daikin IndustriesLtd's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Daikin IndustriesLtd's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 3.8% growth on an annualised basis. This is compared to a historical growth rate of 15% over the past five years. Compare this to the 60 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 4.0% per year. So it's pretty clear that, while Daikin IndustriesLtd's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

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. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall 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 Daikin IndustriesLtd. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Daikin IndustriesLtd analysts - going out to 2027, and you can see them free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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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.