Results: Eisai Co., Ltd. Exceeded Expectations And The Consensus Has Updated Its Estimates

Eisai Co., Ltd. (TSE:4523) just released its latest interim results and things are looking bullish. It was overall a positive result, with revenues beating expectations by 6.0% to hit JP¥385b. Eisai also reported a statutory profit of JP¥76.13, which was an impressive 42% above what the analysts had forecast. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Eisai

Taking into account the latest results, Eisai's 15 analysts currently expect revenues in 2025 to be JP¥763.6b, approximately in line with the last 12 months. Per-share earnings are expected to increase 8.8% to JP¥158. In the lead-up to this report, the analysts had been modelling revenues of JP¥764.8b and earnings per share (EPS) of JP¥156 in 2025. 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.

The analysts reconfirmed their price target of JP¥7,309, showing that the business is executing well and in line with expectations. 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. Currently, the most bullish analyst values Eisai at JP¥11,000 per share, while the most bearish prices it at JP¥5,000. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 2.8% growth on an annualised basis. That is in line with its 2.7% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 4.5% per year. So although Eisai is expected to maintain its revenue growth rate, it's forecast to grow slower 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. 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. We have estimates - from multiple Eisai analysts - going out to 2027, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Eisai that you should be aware of.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.