PAL GROUP Holdings CO., LTD. Just Missed EPS By 6.4%: Here's What Analysts Think Will Happen Next

Shareholders of PAL GROUP Holdings CO., LTD. (TSE:2726) will be pleased this week, given that the stock price is up 16% to JP¥3,815 following its latest yearly results. Revenues of JP¥208b were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at JP¥136, missing estimates by 6.4%. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Taking into account the latest results, the most recent consensus for PAL GROUP Holdings from three analysts is for revenues of JP¥231.8b in 2026. If met, it would imply a solid 12% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to jump 46% to JP¥199. In the lead-up to this report, the analysts had been modelling revenues of JP¥228.3b and earnings per share (EPS) of JP¥191 in 2026. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

View our latest analysis for PAL GROUP Holdings

The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 16% to JP¥4,017. 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. The most optimistic PAL GROUP Holdings analyst has a price target of JP¥4,200 per share, while the most pessimistic values it at JP¥3,750. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting PAL GROUP Holdings is an easy business to forecast or the the analysts are all using similar assumptions.

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. The period to the end of 2026 brings more of the same, according to the analysts, with revenue forecast to display 12% growth on an annualised basis. That is in line with its 14% annual growth 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 revenues grow 7.0% per year. So although PAL GROUP Holdings 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 PAL GROUP Holdings' 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. 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.

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 estimates - from multiple PAL GROUP Holdings analysts - going out to 2028, and you can see them free on our platform here.

You can also see our analysis of PAL GROUP Holdings' Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.