Japan Electronic Materials Corporation (TSE:6855) Analysts Are Pretty Bullish On The Stock After Recent Results

Last week saw the newest first-quarter earnings release from Japan Electronic Materials Corporation (TSE:6855), an important milestone in the company's journey to build a stronger business. Results look mixed - while revenue fell marginally short of analyst estimates at JP¥5.0b, statutory earnings were in line with expectations, at JP¥49.32 per share. This is an important time for investors, as they can track a company's performance in its report, look at what expert is forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analyst latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Japan Electronic Materials

After the latest results, the sole analyst covering Japan Electronic Materials are now predicting revenues of JP¥22.0b in 2025. If met, this would reflect a major 20% improvement in revenue compared to the last 12 months. Per-share earnings are expected to leap 177% to JP¥277. In the lead-up to this report, the analyst had been modelling revenues of JP¥22.0b and earnings per share (EPS) of JP¥143 in 2025. There was no real change to the revenue estimates, but the analyst does seem more bullish on earnings, given the great increase in earnings per share expectations following these results.

The analyst has been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 34% to JP¥5,500.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analyst is definitely expecting Japan Electronic Materials' growth to accelerate, with the forecast 28% annualised growth to the end of 2025 ranking favourably alongside historical growth of 5.5% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 12% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Japan Electronic Materials is expected to grow much faster than its industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Japan Electronic Materials' earnings potential next year. 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. We note an upgrade to the price target, suggesting that the analyst believes the intrinsic value of the business is likely to improve over time.

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 analyst estimates for Japan Electronic Materials going out as far as 2027, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for Japan Electronic Materials (of which 1 can't be ignored!) you should know about.

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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.