Analysts Have Made A Financial Statement On Shin-Etsu Chemical Co., Ltd.'s (TSE:4063) Full-Year Report

Last week, you might have seen that Shin-Etsu Chemical Co., Ltd. (TSE:4063) released its yearly result to the market. The early response was not positive, with shares down 3.6% to JP¥5,906 in the past week. It looks like the results were a bit of a negative overall. While revenues of JP¥2.4t were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 4.6% to hit JP¥259 per share. 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 Shin-Etsu Chemical after the latest results.

Check out our latest analysis for Shin-Etsu Chemical

After the latest results, the 16 analysts covering Shin-Etsu Chemical are now predicting revenues of JP¥2.61t in 2025. If met, this would reflect a reasonable 8.0% improvement in revenue compared to the last 12 months. Per-share earnings are expected to grow 12% to JP¥291. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥2.64t and earnings per share (EPS) of JP¥312 in 2025. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

The consensus price target held steady at JP¥7,073, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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 Shin-Etsu Chemical analyst has a price target of JP¥7,800 per share, while the most pessimistic values it at JP¥5,800. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

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. We would highlight that Shin-Etsu Chemical's revenue growth is expected to slow, with the forecast 8.0% annualised growth rate until the end of 2025 being well below the historical 14% 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 5.6% annually. Even after the forecast slowdown in growth, it seems obvious that Shin-Etsu Chemical is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at JP¥7,073, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Shin-Etsu Chemical. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Shin-Etsu Chemical 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 1 warning sign for Shin-Etsu Chemical 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.