Advantest Corporation Just Missed Earnings - But Analysts Have Updated Their Models

Investors in Advantest Corporation (TSE:6857) had a good week, as its shares rose 5.0% to close at JP¥5,710 following the release of its annual results. Advantest beat revenue expectations by 5.2%, at JP¥780b. Statutory earnings per share (EPS) came in at JP¥219, some 6.7% short of analyst estimates. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Advantest after the latest results.

We've discovered 1 warning sign about Advantest. View them for free.

After the latest results, the 18 analysts covering Advantest are now predicting revenues of JP¥826.9b in 2026. If met, this would reflect a modest 6.1% improvement in revenue compared to the last 12 months. Per-share earnings are expected to shoot up 32% to JP¥290. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥851.3b and earnings per share (EPS) of JP¥297 in 2026. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the small dip in earnings per share expectations.

See our latest analysis for Advantest

It'll come as no surprise then, to learn that the analysts have cut their price target 10% to JP¥9,145. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Advantest analyst has a price target of JP¥12,000 per share, while the most pessimistic values it at JP¥6,000. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Advantest's revenue growth is expected to slow, with the forecast 6.1% annualised growth rate until the end of 2026 being well below the historical 18% 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 7.6% per year. Factoring in the forecast slowdown in growth, it seems obvious that Advantest is also expected to grow slower than other industry participants.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Advantest. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Advantest going out to 2028, and you can see them free on our platform here..

Before you take the next step you should know about the 1 warning sign for Advantest that we have uncovered.

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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.