Earnings Beat: Yokogawa Electric Corporation Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

Investors in Yokogawa Electric Corporation (TSE:6841) had a good week, as its shares rose 7.2% to close at JP¥3,682 following the release of its half-year results. Revenues were JP¥267b, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of JP¥55.80 were also better than expected, beating analyst predictions by 15%. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Check out our latest analysis for Yokogawa Electric

Taking into account the latest results, the most recent consensus for Yokogawa Electric from eight analysts is for revenues of JP¥568.4b in 2025. If met, it would imply a satisfactory 2.9% increase on its revenue over the past 12 months. Per-share earnings are expected to increase 3.8% to JP¥204. Before this earnings report, the analysts had been forecasting revenues of JP¥569.1b and earnings per share (EPS) of JP¥205 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.

There were no changes to revenue or earnings estimates or the price target of JP¥4,479, suggesting that the company has met expectations in its recent result. 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. There are some variant perceptions on Yokogawa Electric, with the most bullish analyst valuing it at JP¥5,000 and the most bearish at JP¥3,900 per share. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Yokogawa Electric's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 5.9% growth on an annualised basis. This is compared to a historical growth rate of 7.9% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 7.3% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Yokogawa Electric.

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. The consensus price target held steady at JP¥4,479, 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 Yokogawa Electric analysts - going out to 2027, and you can see them free on our platform here.

You can also see our analysis of Yokogawa Electric's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.