Ezaki Glico Co., Ltd. (TSE:2206) First-Quarter Results: Here's What Analysts Are Forecasting For This Year

Ezaki Glico Co., Ltd. (TSE:2206) came out with its first-quarter results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Results overall were respectable, with statutory earnings of JP¥222 per share roughly in line with what the analysts had forecast. Revenues of JP¥79b came in 4.2% ahead of analyst predictions. 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for Ezaki Glico

After the latest results, the consensus from Ezaki Glico's four analysts is for revenues of JP¥325.7b in 2024, which would reflect a perceptible 4.4% decline in revenue compared to the last year of performance. Statutory earnings per share are forecast to nosedive 24% to JP¥179 in the same period. In the lead-up to this report, the analysts had been modelling revenues of JP¥341.3b and earnings per share (EPS) of JP¥214 in 2024. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a real cut to earnings per share estimates.

The analysts made no major changes to their price target of JP¥4,130, suggesting the downgrades are not expected to have a long-term impact on Ezaki Glico's valuation. 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 Ezaki Glico, with the most bullish analyst valuing it at JP¥4,620 and the most bearish at JP¥3,800 per share. This is a very narrow spread of estimates, implying either that Ezaki Glico is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Ezaki Glico's past performance and to peers in the same industry. One more thing stood out to us about these estimates, and it's the idea that Ezaki Glico's decline is expected to accelerate, with revenues forecast to fall at an annualised rate of 5.8% to the end of 2024. This tops off a historical decline of 2.3% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 3.7% per year. So while a broad number of companies are forecast to grow, unfortunately Ezaki Glico is expected to see its revenue affected worse than other companies in the industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse 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 estimates - from multiple Ezaki Glico analysts - going out to 2026, 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 1 warning sign for Ezaki Glico 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.