Recruit Holdings Co., Ltd. (TSE:6098) Analysts Are Pretty Bullish On The Stock After Recent Results

It's been a good week for Recruit Holdings Co., Ltd. (TSE:6098) shareholders, because the company has just released its latest half-yearly results, and the shares gained 6.3% to JP¥9,912. Results overall were respectable, with statutory earnings of JP¥226 per share roughly in line with what the analysts had forecast. Revenues of JP¥1.8t came in 4.5% ahead of analyst predictions. 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.

See our latest analysis for Recruit Holdings

Taking into account the latest results, Recruit Holdings' 14 analysts currently expect revenues in 2025 to be JP¥3.55t, approximately in line with the last 12 months. Statutory earnings per share are predicted to accumulate 7.6% to JP¥263. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥3.54t and earnings per share (EPS) of JP¥259 in 2025. 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.

The consensus price target rose 5.0% to JP¥9,831despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Recruit Holdings' earnings by assigning a price premium. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Recruit Holdings at JP¥12,600 per share, while the most bearish prices it at JP¥7,300. 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 Recruit Holdings 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 Recruit Holdings' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 2.5% growth on an annualised basis. This is compared to a historical growth rate of 11% 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 6.0% 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 Recruit Holdings.

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. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Recruit Holdings' revenue is expected to perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

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 estimates - from multiple Recruit Holdings analysts - going out to 2027, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for Recruit Holdings you should be aware of.

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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.