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

Kikkoman Corporation (TSE:2801) shareholders are probably feeling a little disappointed, since its shares fell 2.8% to JP¥1,888 in the week after its latest full-year results. The result was positive overall - although revenues of JP¥661b were in line with what the analysts predicted, Kikkoman surprised by delivering a statutory profit of JP¥59.19 per share, modestly greater than expected. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Kikkoman after the latest results.

Check out our latest analysis for Kikkoman

Following the latest results, Kikkoman's ten analysts are now forecasting revenues of JP¥696.5b in 2025. This would be an okay 5.4% improvement in revenue compared to the last 12 months. Per-share earnings are expected to rise 4.4% to JP¥61.95. Before this earnings report, the analysts had been forecasting revenues of JP¥688.8b and earnings per share (EPS) of JP¥59.61 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

There's been no major changes to the consensus price target of JP¥1,990, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. 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. Currently, the most bullish analyst values Kikkoman at JP¥2,400 per share, while the most bearish prices it at JP¥1,500. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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 Kikkoman's revenue growth is expected to slow, with the forecast 5.4% annualised growth rate until the end of 2025 being well below the historical 8.8% 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 3.7% annually. So it's pretty clear that, while Kikkoman's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Kikkoman following these results. 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 in mind, we wouldn't be too quick to come to a conclusion on Kikkoman. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Kikkoman analysts - going out to 2027, and you can see them free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, 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.