Sumitomo Metal Mining Co., Ltd. Just Recorded A 181% EPS Beat: Here's What Analysts Are Forecasting Next

Explore Sumitomo Metal Mining's Fair Values from the Community and select yours

It's been a good week for Sumitomo Metal Mining Co., Ltd. (TSE:5713) shareholders, because the company has just released its latest quarterly results, and the shares gained 7.7% to JP¥3,646. Revenues were JP¥380b, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at JP¥100, an impressive 181% 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Sumitomo Metal Mining after the latest results.

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Following the recent earnings report, the consensus from eight analysts covering Sumitomo Metal Mining is for revenues of JP¥1.50t in 2026. This implies a perceptible 4.1% decline in revenue compared to the last 12 months. Statutory earnings per share are predicted to jump 168% to JP¥216. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥1.59t and earnings per share (EPS) of JP¥276 in 2026. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a pretty serious reduction to earnings per share numbers.

View our latest analysis for Sumitomo Metal Mining

The analysts made no major changes to their price target of JP¥3,523, suggesting the downgrades are not expected to have a long-term impact on Sumitomo Metal Mining's valuation. 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. There are some variant perceptions on Sumitomo Metal Mining, with the most bullish analyst valuing it at JP¥3,950 and the most bearish at JP¥3,100 per share. This is a very narrow spread of estimates, implying either that Sumitomo Metal Mining is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that revenue is expected to reverse, with a forecast 5.4% annualised decline to the end of 2026. That is a notable change from historical growth of 12% 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 2.8% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Sumitomo Metal Mining is expected to lag 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. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will 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. We have estimates - from multiple Sumitomo Metal Mining analysts - going out to 2028, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for Sumitomo Metal Mining (of which 1 can't be ignored!) 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.