Analysts Have Lowered Expectations For Universal Entertainment Corporation (TSE:6425) After Its Latest Results

As you might know, Universal Entertainment Corporation (TSE:6425) last week released its latest third-quarter, and things did not turn out so great for shareholders. It definitely looks like a negative result overall with revenues falling 16% short of analyst estimates at JP¥29b. Statutory losses were JP¥258 per share, 1,310% bigger than what the analyst expected. The analyst typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analyst has changed their mind on Universal Entertainment after the latest results.

Check out our latest analysis for Universal Entertainment

Following the latest results, Universal Entertainment's sole analyst are now forecasting revenues of JP¥165.2b in 2025. This would be a notable 12% improvement in revenue compared to the last 12 months. Earnings are expected to improve, with Universal Entertainment forecast to report a statutory profit of JP¥7.65 per share. Before this earnings report, the analyst had been forecasting revenues of JP¥184.8b and earnings per share (EPS) of JP¥164 in 2025. Indeed, we can see that the analyst is a lot more bearish about Universal Entertainment's prospects following the latest results, administering a substantial drop in revenue estimates and slashing their EPS estimates to boot.

It'll come as no surprise then, to learn that the analyst has cut their price target 21% to JP¥1,500.

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. The period to the end of 2025 brings more of the same, according to the analyst, with revenue forecast to display 9.6% growth on an annualised basis. That is in line with its 11% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 4.4% per year. So it's pretty clear that Universal Entertainment is forecast to grow substantially faster than its industry.

The Bottom Line

The biggest concern is that the analyst reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Universal Entertainment. They also downgraded Universal Entertainment's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. The consensus price target fell measurably, with the analyst seemingly not reassured by the latest results, leading to a lower estimate of Universal Entertainment's future valuation.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Universal Entertainment , and understanding them should be part of your investment process.

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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.