Rakus Co., Ltd. (TSE:3923) Just Released Its First-Quarter Results And Analysts Are Updating Their Estimates
Rakus Co., Ltd. (TSE:3923) came out with its first-quarter results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. It was a credible result overall, with revenues of JP¥14b and statutory earnings per share of JP¥41.32 both in line with analyst estimates, showing that Rakus is executing in line with 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Taking into account the latest results, Rakus' seven analysts currently expect revenues in 2027 to be JP¥60.4b, approximately in line with the last 12 months. Statutory earnings per share are predicted to increase 8.7% to JP¥74.84. Before this earnings report, the analysts had been forecasting revenues of JP¥60.4b and earnings per share (EPS) of JP¥74.53 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.
View our latest analysis for Rakus
There were no changes to revenue or earnings estimates or the price target of JP¥1,147, suggesting that the company has met expectations in its recent result. 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 Rakus analyst has a price target of JP¥1,450 per share, while the most pessimistic values it at JP¥900. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Rakus shareholders.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Rakus' revenue growth will slow down substantially, with revenues to the end of 2027 expected to display 0.06% growth on an annualised basis. This is compared to a historical growth rate of 26% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 10% annually. Factoring in the forecast slowdown in growth, it seems obvious that Rakus is also expected to grow slower than other industry participants.
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. 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.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Rakus going out to 2029, and you can see them free on our platform here.
Plus, you should also learn about the 2 warning signs we've spotted with Rakus .
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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.