Analysts Have Made A Financial Statement On ZOZO, Inc.'s (TSE:3092) Yearly Report

ZOZO, Inc. (TSE:3092) last week reported its latest yearly results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. ZOZO reported JP¥197b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of JP¥148 beat expectations, being 4.4% higher than what the analysts expected. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on ZOZO after the latest results.

See our latest analysis for ZOZO

Taking into account the latest results, the consensus forecast from ZOZO's 15 analysts is for revenues of JP¥214.5b in 2025. This reflects a decent 8.9% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to accumulate 2.8% to JP¥153. Before this earnings report, the analysts had been forecasting revenues of JP¥214.6b and earnings per share (EPS) of JP¥152 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at JP¥3,532. 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. Currently, the most bullish analyst values ZOZO at JP¥4,000 per share, while the most bearish prices it at JP¥3,100. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that ZOZO's revenue growth is expected to slow, with the forecast 8.9% annualised growth rate until the end of 2025 being well below the historical 11% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 6.8% per year. So it's pretty clear that, while ZOZO's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at JP¥3,532, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on ZOZO. Long-term earnings power is much more important than next year's profits. We have forecasts for ZOZO going out to 2027, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for ZOZO (of which 1 doesn't sit too well with us!) you should know about.

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.