Toray Industries, Inc. Just Missed Earnings - But Analysts Have Updated Their Models

Toray Industries, Inc. (TSE:3402) missed earnings with its latest third-quarter results, disappointing overly-optimistic forecasters. Toray Industries missed earnings this time around, with JP¥630b revenue coming in 6.5% below what the analysts had modelled. Statutory earnings per share (EPS) of JP¥12.34 also fell short of expectations by 14%. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Toray Industries

Taking into account the latest results, the current consensus from Toray Industries' eleven analysts is for revenues of JP¥2.72t in 2026. This would reflect a satisfactory 6.4% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 117% to JP¥70.67. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥2.73t and earnings per share (EPS) of JP¥71.04 in 2026. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The analysts reconfirmed their price target of JP¥1,048, showing that the business is executing well and in line with expectations. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Toray Industries analyst has a price target of JP¥1,300 per share, while the most pessimistic values it at JP¥790. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

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 can infer from the latest estimates that forecasts expect a continuation of Toray Industries'historical trends, as the 5.1% annualised revenue growth to the end of 2026 is roughly in line with the 5.2% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 5.0% per year. So although Toray Industries is expected to maintain its revenue growth rate, it's only growing at about the rate of 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. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at JP¥1,048, with the latest estimates not enough to have an impact on their price targets.

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. We have estimates - from multiple Toray Industries analysts - going out to 2027, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 3 warning signs for Toray Industries you should know about.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.