Hitachi, Ltd. Just Missed EPS By 5.1%: Here's What Analysts Think Will Happen Next

Last week saw the newest annual earnings release from Hitachi, Ltd. (TSE:6501), an important milestone in the company's journey to build a stronger business. It looks like the results were a bit of a negative overall. While revenues of JP¥9.8t were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 5.1% to hit JP¥134 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Our free stock report includes 1 warning sign investors should be aware of before investing in Hitachi. Read for free now.

Taking into account the latest results, the most recent consensus for Hitachi from 13 analysts is for revenues of JP¥10t in 2026. If met, it would imply an okay 6.3% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to jump 30% to JP¥175. In the lead-up to this report, the analysts had been modelling revenues of JP¥10t and earnings per share (EPS) of JP¥180 in 2026. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

Check out our latest analysis for Hitachi

It might be a surprise to learn that the consensus price target was broadly unchanged at JP¥4,587, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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 Hitachi, with the most bullish analyst valuing it at JP¥5,200 and the most bearish at JP¥3,400 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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. The analysts are definitely expecting Hitachi's growth to accelerate, with the forecast 6.3% annualised growth to the end of 2026 ranking favourably alongside historical growth of 2.8% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 4.1% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Hitachi to grow faster than the wider industry.

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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Hitachi going out to 2028, and you can see them free on our platform here.

It is also worth noting that we have found 1 warning sign for Hitachi 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.