Dentsu Soken Inc. (TSE:4812) Just Reported Interim Earnings: Have Analysts Changed Their Mind On The Stock?

It's been a good week for Dentsu Soken Inc. (TSE:4812) shareholders, because the company has just released its latest interim results, and the shares gained 7.8% to JP¥6,630. Revenues came in 2.8% below expectations, at JP¥40b. Statutory earnings per share were relatively better off, with a per-share profit of JP¥232 being roughly in line with 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

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After the latest results, the three analysts covering Dentsu Soken are now predicting revenues of JP¥169.4b in 2025. If met, this would reflect a modest 6.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to accumulate 7.8% to JP¥258. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥169.6b and earnings per share (EPS) of JP¥255 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.

See our latest analysis for Dentsu Soken

It will come as no surprise then, to learn that the consensus price target is largely unchanged at JP¥6,933. 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. There are some variant perceptions on Dentsu Soken, with the most bullish analyst valuing it at JP¥7,400 and the most bearish at JP¥6,300 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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. It's clear from the latest estimates that Dentsu Soken's rate of growth is expected to accelerate meaningfully, with the forecast 14% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 9.0% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.4% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Dentsu Soken to grow faster 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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at JP¥6,933, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Dentsu Soken going out to 2027, and you can see them free on our platform here..

We also provide an overview of the Dentsu Soken Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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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.