Ushio Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

A week ago, Ushio Inc. (TSE:6925) came out with a strong set of half-yearly numbers that could potentially lead to a re-rate of the stock. The company beat forecasts, with revenue of JP¥86b, some 6.6% above estimates, and statutory earnings per share (EPS) coming in at JP¥22.95, 93% ahead of expectations. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Ushio

After the latest results, the consensus from Ushio's four analysts is for revenues of JP¥175.4b in 2025, which would reflect a discernible 2.6% decline in revenue compared to the last year of performance. Statutory earnings per share are expected to plummet 32% to JP¥61.56 in the same period. Before this earnings report, the analysts had been forecasting revenues of JP¥175.6b and earnings per share (EPS) of JP¥49.63 in 2025. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the great increase in earnings per share expectations following these results.

The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 7.1% to JP¥2,088. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Ushio at JP¥2,400 per share, while the most bearish prices it at JP¥1,800. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 5.1% by the end of 2025. This indicates a significant reduction from annual growth of 5.4% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 4.5% annually for the foreseeable future. It's pretty clear that Ushio's revenues are expected to perform substantially worse than 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 Ushio following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Ushio's revenue is expected to perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

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 Ushio going out to 2027, and you can see them free on our platform here.

You still need to take note of risks, for example - Ushio has 1 warning sign we think you should be aware 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.