Shareholders might have noticed that ORIX Corporation (TSE:8591) filed its interim result this time last week. The early response was not positive, with shares down 6.2% to JP¥5,347 in the past week. Revenues of JP¥797b fell slightly short of expectations, but earnings were a definite bright spot, with statutory per-share profits of JP¥529 an impressive 115% ahead of estimates. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on ORIX after the latest results.
Taking into account the latest results, ORIX's seven analysts currently expect revenues in 2027 to be JP¥3.46t, approximately in line with the last 12 months. Statutory earnings per share are forecast to sink 18% to JP¥726 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥3.45t and earnings per share (EPS) of JP¥747 in 2027. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.
View our latest analysis for ORIX
The consensus price target held steady at JP¥6,940, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values ORIX at JP¥9,100 per share, while the most bearish prices it at JP¥6,000. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
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 0.8% annualised decline to the end of 2027. That is a notable change from historical growth of 6.4% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 1.5% annually for the foreseeable future. It's pretty clear that ORIX's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider 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.
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 ORIX analysts - going out to 2029, and you can see them free on our platform here.
We don't want to rain on the parade too much, but we did also find 3 warning signs for ORIX (1 is significant!) that you need to be mindful of.
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