Analysts Are Updating Their Nippon Paint Holdings Co., Ltd. (TSE:4612) Estimates After Its Interim Results

Nippon Paint Holdings Co., Ltd. (TSE:4612) came out with its interim results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Nippon Paint Holdings beat revenue expectations by 2.8%, at JP¥817b. Statutory earnings per share (EPS) came in at JP¥15.36, some 3.9% short of analyst estimates. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Nippon Paint Holdings after the latest results.

Check out our latest analysis for Nippon Paint Holdings

Following last week's earnings report, Nippon Paint Holdings' ten analysts are forecasting 2024 revenues to be JP¥1.58t, approximately in line with the last 12 months. Per-share earnings are expected to rise 4.5% to JP¥55.11. Before this earnings report, the analysts had been forecasting revenues of JP¥1.58t and earnings per share (EPS) of JP¥54.67 in 2024. 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.

The analysts reconfirmed their price target of JP¥1,211, showing that the business is executing well and in line with expectations. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Nippon Paint Holdings analyst has a price target of JP¥1,450 per share, while the most pessimistic values it at JP¥1,050. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Nippon Paint Holdings shareholders.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Nippon Paint Holdings' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 1.9% growth on an annualised basis. This is compared to a historical growth rate of 19% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 5.6% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Nippon Paint Holdings.

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 Nippon Paint Holdings' 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.

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 forecasts for Nippon Paint Holdings going out to 2026, and you can see them free on our platform here.

You can also see whether Nippon Paint Holdings is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.

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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.