Eisai Co., Ltd. Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

Eisai Co., Ltd. (TSE:4523) shareholders are probably feeling a little disappointed, since its shares fell 4.0% to JP¥4,387 in the week after its latest half-year results. Revenues were JP¥400b, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of JP¥87.37 were also better than expected, beating analyst predictions by 17%. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Eisai after the latest results.

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Taking into account the latest results, Eisai's 13 analysts currently expect revenues in 2026 to be JP¥805.5b, approximately in line with the last 12 months. Statutory earnings per share are forecast to reduce 6.1% to JP¥164 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥805.3b and earnings per share (EPS) of JP¥168 in 2026. 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.

See our latest analysis for Eisai

There were no changes to revenue or earnings estimates or the price target of JP¥5,027, suggesting that the company has met expectations in its recent result. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Eisai, with the most bullish analyst valuing it at JP¥6,200 and the most bearish at JP¥3,600 per share. 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.

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 Eisai's revenue growth is expected to slow, with the forecast 0.3% annualised growth rate until the end of 2026 being well below the historical 2.9% 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 3.8% per year. Factoring in the forecast slowdown in growth, it seems obvious that Eisai is also expected to grow slower than other industry participants.

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. On the plus side, there were no major changes to revenue estimates; although 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 in mind, we wouldn't be too quick to come to a conclusion on Eisai. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Eisai going out to 2028, and you can see them free on our platform here..

However, before you get too enthused, we've discovered 1 warning sign for Eisai that you should be aware 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.