Results: Meiji Holdings Co., Ltd. Exceeded Expectations And The Consensus Has Updated Its Estimates

Last week, you might have seen that Meiji Holdings Co., Ltd. (TSE:2269) released its third-quarter result to the market. The early response was not positive, with shares down 2.4% to JP¥2,948 in the past week. Revenues were JP¥306b, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at JP¥61.72, an impressive 27% ahead of estimates. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Meiji Holdings

Following the latest results, Meiji Holdings' eight analysts are now forecasting revenues of JP¥1.18t in 2026. This would be an okay 2.6% improvement in revenue compared to the last 12 months. Per-share earnings are expected to climb 14% to JP¥208. Before this earnings report, the analysts had been forecasting revenues of JP¥1.18t and earnings per share (EPS) of JP¥208 in 2026. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at JP¥3,438. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Meiji Holdings analyst has a price target of JP¥4,400 per share, while the most pessimistic values it at JP¥3,000. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Meiji Holdings' past performance and to peers in the same industry. One thing stands out from these estimates, which is that Meiji Holdings is forecast to grow faster in the future than it has in the past, with revenues expected to display 2.1% annualised growth until the end of 2026. If achieved, this would be a much better result than the 2.5% annual decline 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 revenue grow 4.0% per year. So although Meiji Holdings' revenue growth is expected to improve, it is still expected to grow slower than the industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Meiji Holdings' revenue is expected to perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Meiji Holdings. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Meiji Holdings going out to 2027, and you can see them free on our platform here..

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Meiji Holdings that you should be aware of.

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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.