Analysts Have Made A Financial Statement On TDK Corporation's (TSE:6762) Annual Report

It's been a pretty great week for TDK Corporation (TSE:6762) shareholders, with its shares surging 10% to JP¥1,522 in the week since its latest full-year results. TDK reported in line with analyst predictions, delivering revenues of JP¥2.2t and statutory earnings per share of JP¥88.10, suggesting the business is executing well and in line with its plan. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on TDK after the latest results.

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Following the latest results, TDK's 15 analysts are now forecasting revenues of JP¥2.25t in 2026. This would be a credible 2.1% improvement in revenue compared to the last 12 months. Per-share earnings are expected to accumulate 7.7% to JP¥94.89. In the lead-up to this report, the analysts had been modelling revenues of JP¥2.29t and earnings per share (EPS) of JP¥98.41 in 2026. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

See our latest analysis for TDK

It might be a surprise to learn that the consensus price target was broadly unchanged at JP¥2,028, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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. Currently, the most bullish analyst values TDK at JP¥2,500 per share, while the most bearish prices it at JP¥1,300. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that TDK's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 2.1% growth on an annualised basis. This is compared to a historical growth rate of 10% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.3% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than TDK.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at JP¥2,028, 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. We have estimates - from multiple TDK analysts - going out to 2028, and you can see them free on our platform here.

You still need to take note of risks, for example - TDK has 2 warning signs we think you should be aware 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.