Genky DrugStores Co., Ltd. (TSE:9267) Just Reported And Analysts Have Been Lifting Their Price Targets

Shareholders might have noticed that Genky DrugStores Co., Ltd. (TSE:9267) filed its first-quarter result this time last week. The early response was not positive, with shares down 3.9% to JP¥3,100 in the past week. Results were roughly in line with estimates, with revenues of JP¥50b and statutory earnings per share of JP¥208. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Genky DrugStores after the latest results.

Check out our latest analysis for Genky DrugStores

After the latest results, the twin analysts covering Genky DrugStores are now predicting revenues of JP¥203.9b in 2025. If met, this would reflect a solid 8.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to climb 12% to JP¥237. In the lead-up to this report, the analysts had been modelling revenues of JP¥203.9b and earnings per share (EPS) of JP¥220 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 11% to JP¥4,300.

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 can infer from the latest estimates that forecasts expect a continuation of Genky DrugStores'historical trends, as the 11% annualised revenue growth to the end of 2025 is roughly in line with the 10% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 2.6% annually. So although Genky DrugStores is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Genky DrugStores' 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.

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. At least one analyst has provided forecasts out to 2027, which can be seen for free on our platform here.

And what about risks? Every company has them, and we've spotted 1 warning sign for Genky DrugStores 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.