Kobe Steel, Ltd. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Kobe Steel, Ltd. (TSE:5406) shareholders are probably feeling a little disappointed, since its shares fell 4.1% to JP¥1,527 in the week after its latest full-year results. Revenues of JP¥2.6t were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at JP¥305, missing estimates by 8.0%. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

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Taking into account the latest results, Kobe Steel's seven analysts currently expect revenues in 2026 to be JP¥2.52t, approximately in line with the last 12 months. Statutory earnings per share are forecast to decline 18% to JP¥250 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥2.53t and earnings per share (EPS) of JP¥254 in 2026. 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.

Check out our latest analysis for Kobe Steel

There were no changes to revenue or earnings estimates or the price target of JP¥1,863, suggesting that the company has met expectations in its recent result. 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. Currently, the most bullish analyst values Kobe Steel at JP¥2,350 per share, while the most bearish prices it at JP¥1,550. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 1.3% by the end of 2026. This indicates a significant reduction from annual growth of 9.6% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 2.2% per year. It's pretty clear that Kobe Steel's revenues are expected to perform substantially worse than the wider industry.

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 Kobe Steel'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.

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 Kobe Steel analysts - going out to 2028, 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 Kobe Steel (2 don't sit too well with us!) 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.