Earnings Miss: Kyowa Kirin Co., Ltd. Missed EPS By 13% And Analysts Are Revising Their Forecasts

Kyowa Kirin Co., Ltd. (TSE:4151) shareholders are probably feeling a little disappointed, since its shares fell 8.8% to JP¥2,117 in the week after its latest annual results. Revenues were in line with forecasts, at JP¥496b, although statutory earnings per share came in 13% below what the analysts expected, at JP¥113 per share. 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 Kyowa Kirin after the latest results.

View our latest analysis for Kyowa Kirin

Following last week's earnings report, Kyowa Kirin's twelve analysts are forecasting 2025 revenues to be JP¥498.4b, approximately in line with the last 12 months. Statutory earnings per share are predicted to expand 15% to JP¥131. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥498.1b and earnings per share (EPS) of JP¥136 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at JP¥3,012, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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. There are some variant perceptions on Kyowa Kirin, with the most bullish analyst valuing it at JP¥3,500 and the most bearish at JP¥2,500 per share. 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.

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 Kyowa Kirin's revenue growth is expected to slow, with the forecast 0.6% annualised growth rate until the end of 2025 being well below the historical 11% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.2% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Kyowa Kirin.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Kyowa Kirin. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Kyowa Kirin'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 Kyowa Kirin 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 2 warning signs for Kyowa Kirin 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.