Daiichi Sankyo Company, Limited Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

Daiichi Sankyo Company, Limited (TSE:4568) investors will be delighted, with the company turning in some strong numbers with its latest results. It was overall a positive result, with revenues beating expectations by 6.4% to hit JP¥436b. Daiichi Sankyo Company also reported a statutory profit of JP¥44.60, which was an impressive 88% above what the analysts had forecast. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Daiichi Sankyo Company

Taking into account the latest results, the current consensus from Daiichi Sankyo Company's 16 analysts is for revenues of JP¥1.80t in 2025. This would reflect a credible 6.5% increase on its revenue over the past 12 months. Statutory earnings per share are expected to descend 11% to JP¥108 in the same period. In the lead-up to this report, the analysts had been modelling revenues of JP¥1.80t and earnings per share (EPS) of JP¥106 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.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at JP¥6,545. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Daiichi Sankyo Company at JP¥8,574 per share, while the most bearish prices it at JP¥5,500. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Daiichi Sankyo Company's revenue growth is expected to slow, with the forecast 8.8% annualised growth rate until the end of 2025 being well below the historical 12% 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 5.2% annually. So it's pretty clear that, while Daiichi Sankyo Company's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

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. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at JP¥6,545, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Daiichi Sankyo Company going out to 2027, and you can see them free on our platform here.

You can also see our analysis of Daiichi Sankyo Company'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.

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