Furuya Metal Co., Ltd. Just Beat Revenue Estimates By 73%

Investors in Furuya Metal Co., Ltd. (TSE:7826) had a good week, as its shares rose 8.7% to close at JP¥3,100 following the release of its first-quarter results. Revenue of JP¥23b came in a notable 73% ahead of expectations, while statutory earnings of JP¥263 were in line with what the analysts had been forecasting. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

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Taking into account the latest results, the current consensus, from the three analysts covering Furuya Metal, is for revenues of JP¥64.0b in 2026. This implies a small 4.0% reduction in Furuya Metal's revenue over the past 12 months. Statutory earnings per share are expected to drop 11% to JP¥260 in the same period. Before this earnings report, the analysts had been forecasting revenues of JP¥60.8b and earnings per share (EPS) of JP¥289 in 2026. So it's pretty clear consensus is mixed on Furuya Metal after the latest results; whilethe analysts lifted revenue numbers, they also administered a minor downgrade to per-share earnings expectations.

Check out our latest analysis for Furuya Metal

The consensus price target fell 14% to JP¥3,867, suggesting that the analysts are primarily focused on earnings as the driver of value for this business. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Furuya Metal at JP¥4,100 per share, while the most bearish prices it at JP¥3,500. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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. We would highlight that revenue is expected to reverse, with a forecast 5.2% annualised decline to the end of 2026. That is a notable change from historical growth of 13% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 6.7% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Furuya Metal is expected to lag the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Furuya Metal. They also upgraded their revenue estimates for next year, even though it is expected to grow slower than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Furuya Metal's future valuation.

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. We have forecasts for Furuya Metal going out to 2028, and you can see them free on our platform here.

Plus, you should also learn about the 2 warning signs we've spotted with Furuya Metal .

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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.