Revenue Beat: Ichigo Inc. Exceeded Revenue Forecasts By 106% And Analysts Are Updating Their Estimates

Shareholders of Ichigo Inc. (TSE:2337) will be pleased this week, given that the stock price is up 11% to JP¥453 following its latest first-quarter results. Revenue of JP¥25b came in a notable 106% ahead of expectations, while statutory earnings of JP¥26.89 were in line with what the analysts had been forecasting. The analysts 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 analysts have changed their mind on Ichigo after the latest results.

View our latest analysis for Ichigo

After the latest results, the consensus from Ichigo's three analysts is for revenues of JP¥92.6b in 2025, which would reflect a measurable 5.2% decline in revenue compared to the last year of performance. Statutory per share are forecast to be JP¥32.28, approximately in line with the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥92.6b and earnings per share (EPS) of JP¥31.20 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 10% to JP¥467. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Ichigo, with the most bullish analyst valuing it at JP¥550 and the most bearish at JP¥390 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. Over the past five years, revenues have declined around 5.5% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for an annualised 6.9% decline in revenue until the end of 2025. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 4.4% per year. So while a broad number of companies are forecast to grow, unfortunately Ichigo is expected to see its revenue affected worse than other companies in the industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Ichigo's earnings potential next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Ichigo going out to 2027, and you can see them free on our platform here..

You still need to take note of risks, for example - Ichigo has 3 warning signs (and 1 which is concerning) we think 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.

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