Results: Sekisui House, Ltd. Exceeded Expectations And The Consensus Has Updated Its Estimates

A week ago, Sekisui House, Ltd. (TSE:1928) came out with a strong set of half-yearly numbers that could potentially lead to a re-rate of the stock. Sekisui House delivered a significant beat with revenue hitting JP¥1.9t and statutory EPS reaching JP¥190, both beating estimates by more than 10%. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Sekisui House

Following the latest results, Sekisui House's nine analysts are now forecasting revenues of JP¥3.84t in 2025. This would be a notable 9.5% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to dip 8.5% to JP¥329 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥3.82t and earnings per share (EPS) of JP¥332 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The analysts reconfirmed their price target of JP¥3,941, 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. The most optimistic Sekisui House analyst has a price target of JP¥4,300 per share, while the most pessimistic values it at JP¥3,400. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Sekisui House is an easy business to forecast or the the analysts are all using similar assumptions.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Sekisui House's past performance and to peers in the same industry. The analysts are definitely expecting Sekisui House's growth to accelerate, with the forecast 20% annualised growth to the end of 2025 ranking favourably alongside historical growth of 7.0% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 1.8% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Sekisui House is expected to grow much faster than its industry.

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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at JP¥3,941, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Sekisui House going out to 2027, and you can see them free on our platform here.

Even so, be aware that Sekisui House is showing 2 warning signs in our investment analysis , and 1 of those is a bit concerning...

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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.