Chugai Pharmaceutical Co., Ltd. Just Beat Revenue By 12%: Here's What Analysts Think Will Happen Next

Chugai Pharmaceutical Co., Ltd. (TSE:4519) defied analyst predictions to release its third-quarter results, which were ahead of market expectations. It was a decent earnings report, with revenues and statutory earnings per share (EPS) both performing well. Revenues were 12% higher than the analysts had forecast, at JP¥316b, while EPS of JP¥66.54 beat analyst models by 10%. 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 thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Chugai Pharmaceutical

Following last week's earnings report, Chugai Pharmaceutical's 15 analysts are forecasting 2025 revenues to be JP¥1.15t, approximately in line with the last 12 months. Statutory per-share earnings are expected to be JP¥236, roughly flat on the last 12 months. Before this earnings report, the analysts had been forecasting revenues of JP¥1.15t and earnings per share (EPS) of JP¥233 in 2025. 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¥6,982. 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 Chugai Pharmaceutical analyst has a price target of JP¥8,500 per share, while the most pessimistic values it at JP¥4,500. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Chugai Pharmaceutical's past performance and to peers in the same industry. We would highlight that Chugai Pharmaceutical's revenue growth is expected to slow, with the forecast 0.9% annualised growth rate until the end of 2025 being well below the historical 12% 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 4.8% 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 Chugai Pharmaceutical.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Chugai Pharmaceutical's revenue is expected to perform worse than the wider industry. The consensus price target held steady at JP¥6,982, with the latest estimates not enough to have an impact on their price targets.

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 Chugai Pharmaceutical analysts - going out to 2026, and you can see them free on our platform here.

You can also see our analysis of Chugai Pharmaceutical's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.