Rinnai Corporation Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

It's been a good week for Rinnai Corporation (TSE:5947) shareholders, because the company has just released its latest half-yearly results, and the shares gained 8.2% to JP¥3,787. Revenues were JP¥216b, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of JP¥114 were also better than expected, beating analyst predictions by 16%. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

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Taking into account the latest results, the consensus forecast from Rinnai's eight analysts is for revenues of JP¥474.4b in 2026. This reflects a credible 2.1% improvement in revenue compared to the last 12 months. Statutory per-share earnings are expected to be JP¥237, roughly flat on the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥473.6b and earnings per share (EPS) of JP¥236 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.

Check out our latest analysis for Rinnai

It will come as no surprise then, to learn that the consensus price target is largely unchanged at JP¥4,401. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Rinnai analyst has a price target of JP¥4,960 per share, while the most pessimistic values it at JP¥4,000. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Rinnai is an easy business to forecast or the the analysts are all using similar assumptions.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Rinnai's revenue growth is expected to slow, with the forecast 4.3% annualised growth rate until the end of 2026 being well below the historical 6.9% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 1.5% annually. Even after the forecast slowdown in growth, it seems obvious that Rinnai is also expected to grow faster than the wider 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. 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. We have forecasts for Rinnai going out to 2028, and you can see them free on our platform here.

You can also see our analysis of Rinnai's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.