Saizeriya Co.,Ltd. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Saizeriya Co.,Ltd. (TSE:7581) shareholders are probably feeling a little disappointed, since its shares fell 7.2% to JP¥5,450 in the week after its latest half-yearly results. Things were not great overall, with a surprise (statutory) loss of JP¥3.04 per share on revenues of JP¥105b, even though the analysts had been expecting a profit. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on SaizeriyaLtd after the latest results.

See our latest analysis for SaizeriyaLtd

After the latest results, the six analysts covering SaizeriyaLtd are now predicting revenues of JP¥215.1b in 2024. If met, this would reflect a modest 5.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to rise 6.1% to JP¥154. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥211.0b and earnings per share (EPS) of JP¥173 in 2024. So there's definitely been a decline in sentiment after the latest results, noting the substantial drop in new EPS forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at JP¥6,750, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on SaizeriyaLtd, with the most bullish analyst valuing it at JP¥7,400 and the most bearish at JP¥6,300 per share. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting SaizeriyaLtd's growth to accelerate, with the forecast 11% annualised growth to the end of 2024 ranking favourably alongside historical growth of 4.8% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 7.2% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect SaizeriyaLtd to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for SaizeriyaLtd. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at JP¥6,750, with the latest estimates not enough to have an impact on their price targets.

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 SaizeriyaLtd going out to 2026, and you can see them free on our platform here.

We also provide an overview of the SaizeriyaLtd Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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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.