Earnings Miss: IHI Corporation Missed EPS By 36% And Analysts Are Revising Their Forecasts

It's shaping up to be a tough period for IHI Corporation (TSE:7013), which a week ago released some disappointing first-quarter results that could have a notable impact on how the market views the stock. Results showed a clear earnings miss, with JP¥338b revenue coming in 6.2% lower than what the analystsexpected. Statutory earnings per share (EPS) of JP¥76.64 missed the mark badly, arriving some 36% below what was expected. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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Following the latest results, IHI's eleven analysts are now forecasting revenues of JP¥1.68t in 2026. This would be an okay 3.9% improvement in revenue compared to the last 12 months. Per-share earnings are expected to step up 11% to JP¥774. Before this earnings report, the analysts had been forecasting revenues of JP¥1.68t and earnings per share (EPS) of JP¥762 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.

See our latest analysis for IHI

The analysts reconfirmed their price target of JP¥17,009, showing that the business is executing well and in line with expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on IHI, with the most bullish analyst valuing it at JP¥20,000 and the most bearish at JP¥7,500 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the IHI's past performance and to peers in the same industry. The period to the end of 2026 brings more of the same, according to the analysts, with revenue forecast to display 5.2% growth on an annualised basis. That is in line with its 6.3% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 4.7% annually. It's clear that while IHI's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at JP¥17,009, with the latest estimates not enough to have an impact on their price targets.

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. At Simply Wall St, we have a full range of analyst estimates for IHI going out to 2028, 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 2 warning signs for IHI 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.