Otsuka Holdings Co., Ltd. (TSE:4578) shareholders are probably feeling a little disappointed, since its shares fell 4.2% to JP¥11,770 in the week after its latest third-quarter results. It looks like a credible result overall – although revenues of JP¥710b were in line with what the analysts predicted, Otsuka Holdings surprised by delivering a statutory profit of JP¥203 per share, a notable 12% above expectations. 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.
Taking into account the latest results, the current consensus from Otsuka Holdings’ 13 analysts is for revenues of JP¥2.82t in 2027. This would reflect a modest 4.6% increase on its revenue over the past 12 months. Statutory earnings per share are expected to decrease 2.7% to JP¥720 in the same period. In the lead-up to this report, the analysts had been modelling revenues of JP¥2.82t and earnings per share (EPS) of JP¥717 in 2027. 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.
Check out our latest analysis for Otsuka Holdings
There were no changes to revenue or earnings estimates or the price target of JP¥14,631, suggesting that the company has met expectations in its recent result. 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 Otsuka Holdings analyst has a price target of JP¥18,600 per share, while the most pessimistic values it at JP¥10,200. 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.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Otsuka Holdings’ past performance and to peers in the same industry. We would highlight that Otsuka Holdings’ revenue growth is expected to slow, with the forecast 3.7% annualised growth rate until the end of 2027 being well below the historical 12% 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) 3.5% annually. Factoring in the forecast slowdown in growth, it looks like Otsuka Holdings is forecast to grow at about the same rate as the wider industry.
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. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at JP¥14,631, 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 forecasts for Otsuka Holdings going out to 2028, and you can see them free on our platform here.
We also provide an overview of the Otsuka Holdings Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.
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