Results: Zeon Corporation Exceeded Expectations And The Consensus Has Updated Its Estimates

It's been a good week for Zeon Corporation (TSE:4205) shareholders, because the company has just released its latest third-quarter results, and the shares gained 3.1% to JP¥1,482. Revenues of JP¥102b fell slightly short of expectations, but earnings were a definite bright spot, with statutory per-share profits of JP¥38.27 an impressive 75% ahead of estimates. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for Zeon

Taking into account the latest results, the current consensus from Zeon's nine analysts is for revenues of JP¥423.3b in 2026. This would reflect a credible 2.3% increase on its revenue over the past 12 months. Statutory earnings per share are expected to plummet 21% to JP¥121 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥425.3b and earnings per share (EPS) of JP¥120 in 2026. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at JP¥1,573. 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 Zeon analyst has a price target of JP¥1,800 per share, while the most pessimistic values it at JP¥1,200. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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 Zeon's revenue growth is expected to slow, with the forecast 1.8% annualised growth rate until the end of 2026 being well below the historical 6.3% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 5.0% annually. Factoring in the forecast slowdown in growth, it seems obvious that Zeon is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Zeon's revenue is expected to perform worse than 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 said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Zeon going out to 2027, and you can see them free on our platform here..

We don't want to rain on the parade too much, but we did also find 3 warning signs for Zeon (1 is potentially serious!) that you need to be mindful of.

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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.