Earnings Miss: Yamazaki Baking Co., Ltd. Missed EPS By 7.6% And Analysts Are Revising Their Forecasts

Shareholders of Yamazaki Baking Co., Ltd. (TSE:2212) will be pleased this week, given that the stock price is up 13% to JP¥2,995 following its latest third-quarter results. It was a pretty mixed result, with revenues beating expectations to hit JP¥302b. Statutory earnings fell 7.6% short of analyst forecasts, reaching JP¥26.40 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Yamazaki Baking

Taking into account the latest results, Yamazaki Baking's five analysts currently expect revenues in 2025 to be JP¥1.26t, approximately in line with the last 12 months. Statutory per-share earnings are expected to be JP¥193, roughly flat on the last 12 months. Before this earnings report, the analysts had been forecasting revenues of JP¥1.28t and earnings per share (EPS) of JP¥194 in 2025. 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.

The analysts reconfirmed their price target of JP¥3,670, showing that the business is executing well and in line with expectations. 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. Currently, the most bullish analyst values Yamazaki Baking at JP¥4,150 per share, while the most bearish prices it at JP¥3,300. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that Yamazaki Baking's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 1.0% growth on an annualised basis. This is compared to a historical growth rate of 3.5% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 3.7% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Yamazaki Baking.

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. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Yamazaki Baking's revenue is expected to 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 in mind, we wouldn't be too quick to come to a conclusion on Yamazaki Baking. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Yamazaki Baking analysts - going out to 2026, and you can see them free on our platform here.

We also provide an overview of the Yamazaki Baking Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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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.