There's been a notable change in appetite for Ajinomoto Co., Inc. (TSE:2802) shares in the week since its half-year report, with the stock down 14% to JP¥4,264. It looks like a credible result overall - although revenues of JP¥419b were what the analysts expected, Ajinomoto surprised by delivering a (statutory) profit of JP¥38.68 per share, an impressive 38% above what was forecast. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the consensus forecast from Ajinomoto's 14 analysts is for revenues of JP¥1.74t in 2027. This reflects a reasonable 3.9% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to decline 11% to JP¥147 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥1.74t and earnings per share (EPS) of JP¥146 in 2027. 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.
Check out our latest analysis for Ajinomoto
The analysts reconfirmed their price target of JP¥6,293, showing that the business is executing well and in line with expectations. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Ajinomoto analyst has a price target of JP¥7,300 per share, while the most pessimistic values it at JP¥5,800. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The period to the end of 2027 brings more of the same, according to the analysts, with revenue forecast to display 7.9% growth on an annualised basis. That is in line with its 7.4% annual growth 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 revenues grow 3.9% per year. So although Ajinomoto is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous 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¥6,293, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on Ajinomoto. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Ajinomoto going out to 2029, and you can see them free on our platform here..
Even so, be aware that Ajinomoto is showing 1 warning sign in our investment analysis , you should know about...
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