Hirose Electric Co.,Ltd. Just Recorded A 20% EPS Beat: Here's What Analysts Are Forecasting Next

Hirose Electric Co.,Ltd. (TSE:6806) defied analyst predictions to release its quarterly results, which were ahead of market expectations. It was overall a positive result, with revenues beating expectations by 7.6% to hit JP¥45b. Hirose ElectricLtd reported statutory earnings per share (EPS) JP¥248, which was a notable 20% above what the analysts had forecast. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Hirose ElectricLtd

Taking into account the latest results, the most recent consensus for Hirose ElectricLtd from 13 analysts is for revenues of JP¥177.5b in 2025. If met, it would imply a credible 4.5% increase on its revenue over the past 12 months. Statutory per-share earnings are expected to be JP¥866, roughly flat on the last 12 months. Before this earnings report, the analysts had been forecasting revenues of JP¥176.3b and earnings per share (EPS) of JP¥854 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

The analysts reconfirmed their price target of JP¥20,604, showing that the business is executing well and in line with expectations. 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. The most optimistic Hirose ElectricLtd analyst has a price target of JP¥25,000 per share, while the most pessimistic values it at JP¥16,900. 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.

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 pretty clear that there is an expectation that Hirose ElectricLtd's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 6.0% growth on an annualised basis. This is compared to a historical growth rate of 9.0% 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 7.2% 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 Hirose ElectricLtd.

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. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Hirose ElectricLtd. Long-term earnings power is much more important than next year's profits. We have forecasts for Hirose ElectricLtd going out to 2027, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with Hirose ElectricLtd .

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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com