West Japan Railway Company (TSE:9021) Just Released Its Full-Year Results And Analysts Are Updating Their Estimates

Last week, you might have seen that West Japan Railway Company (TSE:9021) released its full-year result to the market. The early response was not positive, with shares down 3.7% to JP¥2,857 in the past week. The result was positive overall - although revenues of JP¥1.8t were in line with what the analysts predicted, West Japan Railway surprised by delivering a statutory profit of JP¥278 per share, modestly greater than expected. 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. 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, West Japan Railway's ten analysts currently expect revenues in 2027 to be JP¥1.86t, approximately in line with the last 12 months. Statutory earnings per share are expected to sink 15% to JP¥239 in the same period. Before this earnings report, the analysts had been forecasting revenues of JP¥1.86t and earnings per share (EPS) of JP¥239 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 West Japan Railway

The analysts reconfirmed their price target of JP¥3,304, showing that the business is executing well and in line with expectations. 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. There are some variant perceptions on West Japan Railway, with the most bullish analyst valuing it at JP¥3,900 and the most bearish at JP¥3,000 per share. This is a very narrow spread of estimates, implying either that West Japan Railway is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

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 West Japan Railway's revenue growth is expected to slow, with the forecast 0.6% annualised growth rate until the end of 2027 being well below the historical 14% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 2.5% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than West Japan Railway.

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. 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 in mind, we wouldn't be too quick to come to a conclusion on West Japan Railway. 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 West Japan Railway going out to 2029, and you can see them free on our platform here..

Before you take the next step you should know about the 3 warning signs for West Japan Railway (1 is significant!) that we have uncovered.

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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.