Kohoku Kogyo CO.,LTD. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

It's shaping up to be a tough period for Kohoku Kogyo CO.,LTD. (TSE:6524), which a week ago released some disappointing first-quarter results that could have a notable impact on how the market views the stock. Unfortunately, Kohoku KogyoLTD delivered a serious earnings miss. Revenues of JP¥3.6b were 10% below expectations, and statutory earnings per share of JP¥8.56 missed estimates by 70%. 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.

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Taking into account the latest results, the consensus forecast from Kohoku KogyoLTD's three analysts is for revenues of JP¥17.3b in 2025. This reflects a credible 7.5% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to decrease 3.5% to JP¥103 in the same period. In the lead-up to this report, the analysts had been modelling revenues of JP¥17.4b and earnings per share (EPS) of JP¥117 in 2025. So there's definitely been a decline in sentiment after the latest results, noting the substantial drop in new EPS forecasts.

View our latest analysis for Kohoku KogyoLTD

It might be a surprise to learn that the consensus price target was broadly unchanged at JP¥2,950, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Kohoku KogyoLTD at JP¥3,500 per share, while the most bearish prices it at JP¥2,400. 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.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Kohoku KogyoLTD's past performance and to peers in the same industry. We would highlight that Kohoku KogyoLTD's revenue growth is expected to slow, with the forecast 10% annualised growth rate until the end of 2025 being well below the historical 20% growth over the last year. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 6.2% per year. So it's pretty clear that, while Kohoku KogyoLTD's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Kohoku KogyoLTD. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster 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.

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. At Simply Wall St, we have a full range of analyst estimates for Kohoku KogyoLTD going out to 2027, and you can see them free on our platform here..

We don't want to rain on the parade too much, but we did also find 1 warning sign for Kohoku KogyoLTD that you need to be mindful of.

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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.