Mitsubishi Chemical Group Corporation Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

Mitsubishi Chemical Group Corporation (TSE:4188) came out with its quarterly results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. It looks like a credible result overall - although revenues of JP¥1.1t were what the analysts expected, Mitsubishi Chemical Group surprised by delivering a (statutory) profit of JP¥27.87 per share, an impressive 166% above what was forecast. 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Mitsubishi Chemical Group

Taking into account the latest results, the current consensus from Mitsubishi Chemical Group's ten analysts is for revenues of JP¥4.63t in 2025. This would reflect an okay 3.9% increase on its revenue over the past 12 months. Statutory earnings per share are forecast to tumble 36% to JP¥52.55 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥4.62t and earnings per share (EPS) of JP¥51.63 in 2025. 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.

There were no changes to revenue or earnings estimates or the price target of JP¥995, suggesting that the company has met expectations in its recent result. 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 Mitsubishi Chemical Group analyst has a price target of JP¥1,150 per share, while the most pessimistic values it at JP¥890. 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.

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. We can infer from the latest estimates that forecasts expect a continuation of Mitsubishi Chemical Group'shistorical trends, as the 5.2% annualised revenue growth to the end of 2025 is roughly in line with the 6.2% 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 5.7% per year. So although Mitsubishi Chemical Group 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. 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Mitsubishi Chemical Group. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Mitsubishi Chemical Group analysts - going out to 2027, and you can see them free on our platform here.

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Mitsubishi Chemical Group , and understanding these should be part of your investment process.

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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.

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