EN
Tekscend Photomask Corp. Just Beat EPS By 11%: Here's What Analysts Think Will Happen Next
Shareholders of Tekscend Photomask Corp. (TSE:429A) will be pleased this week, given that the stock price is up 16% to JP¥3,005 following its latest half-year results. Revenues were JP¥72b, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of JP¥67.95 were also better than expected, beating analyst predictions by 11%. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the current consensus from Tekscend Photomask's five analysts is for revenues of JP¥148.2b in 2027. This would reflect an okay 5.6% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to rise 9.3% to JP¥271. Before this earnings report, the analysts had been forecasting revenues of JP¥147.3b and earnings per share (EPS) of JP¥261 in 2027. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
See our latest analysis for Tekscend Photomask
There's been no major changes to the consensus price target of JP¥4,640, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Tekscend Photomask at JP¥4,900 per share, while the most bearish prices it at JP¥4,400. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Tekscend Photomask is an easy business to forecast or the the analysts are all using similar assumptions.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Tekscend Photomask's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Tekscend Photomask's revenue growth will slow down substantially, with revenues to the end of 2027 expected to display 12% growth on an annualised basis. This is compared to a historical growth rate of 17% over the past year. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 18% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Tekscend Photomask.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Tekscend Photomask's earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Tekscend Photomask's revenue is expected to 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.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Tekscend Photomask 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 Tekscend Photomask that you need to be mindful of.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.