Ajinomoto Co., Inc. Just Missed Earnings - But Analysts Have Updated Their Models

It's been a mediocre week for Ajinomoto Co., Inc. (TSE:2802) shareholders, with the stock dropping 18% to JP¥5,117 in the week since its latest quarterly results. Revenues were in line with forecasts, at JP¥366b, although statutory earnings per share came in 13% below what the analysts expected, at JP¥46.98 per share. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Ajinomoto

Taking into account the latest results, the most recent consensus for Ajinomoto from 13 analysts is for revenues of JP¥1.54t in 2025. If met, it would imply an okay 4.9% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to soar 22% to JP¥201. In the lead-up to this report, the analysts had been modelling revenues of JP¥1.54t and earnings per share (EPS) of JP¥201 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¥6,385, showing that the business is executing well and in line with expectations. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Ajinomoto analyst has a price target of JP¥7,400 per share, while the most pessimistic values it at JP¥4,500. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 6.5% growth on an annualised basis. That is in line with its 6.7% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 3.6% annually. So although Ajinomoto is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is 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.

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 Ajinomoto going out to 2027, and you can see them free on our platform here.

It might also be worth considering whether Ajinomoto's debt load is appropriate, using our debt analysis tools on the Simply Wall St 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.

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