Maxell, Ltd. Just Beat Revenue Estimates By 6.2%

Shareholders might have noticed that Maxell, Ltd. (TSE:6810) filed its half-yearly result this time last week. The early response was not positive, with shares down 8.3% to JP¥2,265 in the past week. It was a pretty mixed result, with revenues beating expectations to hit JP¥75b. Statutory earnings fell 2.8% short of analyst forecasts, reaching JP¥63.73 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. 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 Maxell’s six analysts is for revenues of JP¥147.2b in 2027. This reflects a modest 5.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to dip 9.5% to JP¥215 in the same period. In the lead-up to this report, the analysts had been modelling revenues of JP¥148.9b and earnings per share (EPS) of JP¥207 in 2027. So the consensus seems to have become somewhat more optimistic on Maxell’s earnings potential following these results.

See our latest analysis for Maxell

The consensus price target was unchanged at JP¥2,420, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Maxell analyst has a price target of JP¥3,100 per share, while the most pessimistic values it at JP¥1,900. This shows there is still a bit of diversity in estimates, but analysts don’t appear to be totally split on the stock as though it might be a success or failure situation.

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. One thing stands out from these estimates, which is that Maxell is forecast to grow faster in the future than it has in the past, with revenues expected to display 11% annualised growth until the end of 2027. If achieved, this would be a much better result than the 1.1% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 10% per year. So it looks like Maxell is expected to grow at about the same rate as the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Maxell’s earnings potential next year. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates – from multiple Maxell analysts – going out to 2029, and you can see them free on our platform here.

It is also worth noting that we have found 2 warning signs for Maxell (1 is a bit unpleasant!) that you need to take into consideration.

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