Earnings Beat: Sony Group Corporation Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

As you might know, Sony Group Corporation (TSE:6758) just kicked off its latest quarterly results with some very strong numbers. Sony Group delivered a significant beat with revenue hitting JP¥3.0t and statutory EPS reaching JP¥189, both beating estimates by more than 10%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Sony Group

Taking into account the latest results, the 20 analysts covering Sony Group provided consensus estimates of JP¥13t revenue in 2025, which would reflect a discernible 3.1% decline over the past 12 months. Statutory earnings per share are predicted to accumulate 4.9% to JP¥851. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥13t and earnings per share (EPS) of JP¥824 in 2025. So the consensus seems to have become somewhat more optimistic on Sony Group's earnings potential following these results.

The consensus price target was unchanged at JP¥16,921, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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. The most optimistic Sony Group analyst has a price target of JP¥21,100 per share, while the most pessimistic values it at JP¥14,200. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Sony Group shareholders.

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. We would highlight that revenue is expected to reverse, with a forecast 4.1% annualised decline to the end of 2025. That is a notable change from historical growth of 9.7% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 1.9% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Sony Group is expected to lag the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Sony Group's earnings potential next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at JP¥16,921, 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 Sony Group going out to 2027, and you can see them free on our platform here.

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