Imperial Hotel, Ltd. (TSE:9708) Just Reported, And Analysts Assigned A JP¥1,025 Price Target

It's shaping up to be a tough period for Imperial Hotel, Ltd. (TSE:9708), which a week ago released some disappointing half-yearly results that could have a notable impact on how the market views the stock. It was a pretty negative result overall, with revenues of JP¥11b missing analyst predictions by 7.4%. Worse, the business reported a statutory loss of JP¥3.57 per share, much larger than the analyst had forecast prior to the result. 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. So we collected the latest post-earnings statutory consensus estimate to see what could be in store for next year.

View our latest analysis for Imperial Hotel

Following last week's earnings report, Imperial Hotel's sole analyst are forecasting 2025 revenues to be JP¥52.8b, approximately in line with the last 12 months. Statutory earnings per share are expected to dive 30% to JP¥16.00 in the same period. In the lead-up to this report, the analyst had been modelling revenues of JP¥54.0b and earnings per share (EPS) of JP¥18.50 in 2025. The analyst seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

It'll come as no surprise then, to learn that the analyst has cut their price target 13% to JP¥1,025.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that revenue is expected to reverse, with a forecast 3.8% annualised decline to the end of 2025. That is a notable change from historical growth of 3.8% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 6.6% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Imperial Hotel is expected to lag the wider industry.

The Bottom Line

The biggest concern is that the analyst reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Imperial Hotel. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Furthermore, the analyst also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At least one analyst has provided forecasts out to 2027, which can be seen for free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.