TRE Holdings Corporation (TSE:9247) Released Earnings Last Week And Analysts Lifted Their Price Target To JP¥2,157

TRE Holdings Corporation (TSE:9247) shareholders are probably feeling a little disappointed, since its shares fell 7.9% to JP¥1,651 in the week after its latest half-year results. Results were roughly in line with estimates, with revenues of JP¥54b and statutory earnings per share of JP¥70.54. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for TRE Holdings

After the latest results, the three analysts covering TRE Holdings are now predicting revenues of JP¥105.5b in 2025. If met, this would reflect a modest 3.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 23% to JP¥145. Before this earnings report, the analysts had been forecasting revenues of JP¥105.3b and earnings per share (EPS) of JP¥129 in 2025. Although the revenue estimates have not really changed, we can see there's been a nice gain to earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.

The consensus price target rose 8.4% to JP¥2,157, suggesting that higher earnings estimates flow through to the stock's valuation as well. 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. There are some variant perceptions on TRE Holdings, with the most bullish analyst valuing it at JP¥2,500 and the most bearish at JP¥1,670 per share. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

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. We would highlight that TRE Holdings' revenue growth is expected to slow, with the forecast 6.9% annualised growth rate until the end of 2025 being well below the historical 12% growth over the last year. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 3.9% annually. So it's pretty clear that, while TRE Holdings' revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around TRE Holdings' earnings potential next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster 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 TRE Holdings analysts - going out to 2027, and you can see them free on our platform here.

You still need to take note of risks, for example - TRE Holdings has 2 warning signs (and 1 which is significant) we think you should know about.

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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.