Canon Inc. Just Missed EPS By 50%: Here's What Analysts Think Will Happen Next

Shareholders might have noticed that Canon Inc. (TSE:7751) filed its annual result this time last week. The early response was not positive, with shares down 3.0% to JP¥4,698 in the past week. It looks like a pretty bad result, all things considered. Although revenues of JP¥4.5t were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 50% to hit JP¥166 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. 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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Taking into account the latest results, the consensus forecast from Canon's eleven analysts is for revenues of JP¥4.67t in 2025. This reflects a satisfactory 3.5% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 115% to JP¥373. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥4.68t and earnings per share (EPS) of JP¥377 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 Canon

It will come as no surprise then, to learn that the consensus price target is largely unchanged at JP¥5,453. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Canon analyst has a price target of JP¥6,500 per share, while the most pessimistic values it at JP¥5,000. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Canon is an easy business to forecast or the the analysts are all using similar assumptions.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Canon's revenue growth is expected to slow, with the forecast 3.5% annualised growth rate until the end of 2025 being well below the historical 6.8% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 2.6% per year. So it's pretty clear that, while Canon's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

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. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at JP¥5,453, 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 Canon going out to 2027, and you can see them free on our platform here..

Even so, be aware that Canon is showing 3 warning signs in our investment analysis , you should know about...

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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.