Menicon Co., Ltd. (TSE:7780) Half-Yearly Results: Here's What Analysts Are Forecasting For This Year

Menicon Co., Ltd. (TSE:7780) shareholders are probably feeling a little disappointed, since its shares fell 3.7% to JP¥1,619 in the week after its latest half-yearly results. Menicon reported in line with analyst predictions, delivering revenues of JP¥61b and statutory earnings per share of JP¥59.65, suggesting the business is executing well and in line with its plan. 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.

Check out our latest analysis for Menicon

Taking into account the latest results, the most recent consensus for Menicon from five analysts is for revenues of JP¥123.3b in 2025. If met, it would imply a satisfactory 3.9% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to bounce 51% to JP¥96.63. Before this earnings report, the analysts had been forecasting revenues of JP¥123.4b and earnings per share (EPS) of JP¥101 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at JP¥2,296, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on 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. The most optimistic Menicon analyst has a price target of JP¥2,780 per share, while the most pessimistic values it at JP¥2,100. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We can infer from the latest estimates that forecasts expect a continuation of Menicon'shistorical trends, as the 8.0% annualised revenue growth to the end of 2025 is roughly in line with the 8.5% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 6.5% annually. So although Menicon is expected to maintain its revenue growth rate, it's only growing at about the rate of the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Menicon. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Menicon going out to 2027, and you can see them free on our platform here..

You can also see whether Menicon is carrying too much debt, and whether its balance sheet is healthy, for free 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.