JP¥386 - That's What Analysts Think Sumitomo Chemical Company, Limited (TSE:4005) Is Worth After These Results

Sumitomo Chemical Company, Limited (TSE:4005) last week reported its latest first-quarter results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Sumitomo Chemical Company

Following the latest results, Sumitomo Chemical Company's ten analysts are now forecasting revenues of JP¥2.61t in 2025. This would be a satisfactory 4.5% improvement in revenue compared to the last 12 months. Earnings are expected to improve, with Sumitomo Chemical Company forecast to report a statutory profit of JP¥14.65 per share. In the lead-up to this report, the analysts had been modelling revenues of JP¥2.61t and earnings per share (EPS) of JP¥13.30 in 2025. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the nice increase in earnings per share expectations following these results.

The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 5.3% to JP¥386. 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. There are some variant perceptions on Sumitomo Chemical Company, with the most bullish analyst valuing it at JP¥550 and the most bearish at JP¥285 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

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. The analysts are definitely expecting Sumitomo Chemical Company's growth to accelerate, with the forecast 6.0% annualised growth to the end of 2025 ranking favourably alongside historical growth of 4.1% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.7% annually. Sumitomo Chemical Company is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

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 Sumitomo Chemical Company following these results. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

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 estimates - from multiple Sumitomo Chemical Company 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 2 warning signs for Sumitomo Chemical Company you should know about.

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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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