Analysts Are Updating Their Organo Corporation (TSE:6368) Estimates After Its First-Quarter Results

Last week saw the newest quarterly earnings release from Organo Corporation (TSE:6368), an important milestone in the company's journey to build a stronger business. Revenues of JP¥32b were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at JP¥58.25, missing estimates by 3.3%. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Organo

Taking into account the latest results, the current consensus from Organo's three analysts is for revenues of JP¥158.1b in 2025. This would reflect a credible 3.7% increase on its revenue over the past 12 months. Statutory per share are forecast to be JP¥400, approximately in line with the last 12 months. Before this earnings report, the analysts had been forecasting revenues of JP¥156.3b and earnings per share (EPS) of JP¥384 in 2025. So the consensus seems to have become somewhat more optimistic on Organo's earnings potential following these results.

There's been no major changes to the consensus price target of JP¥9,125, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's 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. Currently, the most bullish analyst values Organo at JP¥10,500 per share, while the most bearish prices it at JP¥7,750. 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.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that Organo's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 5.0% growth on an annualised basis. This is compared to a historical growth rate of 10% over the past five years. Compare this to the 261 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 4.9% per year. Factoring in the forecast slowdown in growth, it looks like Organo is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Organo's earnings potential next year. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as 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. At Simply Wall St, we have a full range of analyst estimates for Organo going out to 2027, and you can see them free on our platform here..

We don't want to rain on the parade too much, but we did also find 1 warning sign for Organo that you need to be mindful of.

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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.

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