It's shaping up to be a tough period for ZOZO, Inc. (TSE:3092), which a week ago released some disappointing interim results that could have a notable impact on how the market views the stock. ZOZO missed earnings this time around, with JP¥105b revenue coming in 2.5% below what the analysts had modelled. Statutory earnings per share (EPS) of JP¥10.89 also fell short of expectations by 15%. 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.
Taking into account the latest results, the most recent consensus for ZOZO from 17 analysts is for revenues of JP¥230.5b in 2026. If met, it would imply a reasonable 5.0% increase on its revenue over the past 12 months. Per-share earnings are expected to increase 8.0% to JP¥55.23. In the lead-up to this report, the analysts had been modelling revenues of JP¥231.6b and earnings per share (EPS) of JP¥55.53 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.
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It will come as no surprise then, to learn that the consensus price target is largely unchanged at JP¥1,454. 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. There are some variant perceptions on ZOZO, with the most bullish analyst valuing it at JP¥1,900 and the most bearish at JP¥1,000 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The period to the end of 2026 brings more of the same, according to the analysts, with revenue forecast to display 10% growth on an annualised basis. That is in line with its 9.1% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 7.0% annually. So although ZOZO is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider 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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster 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.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for ZOZO going out to 2028, and you can see them free on our platform here.
It is also worth noting that we have found 1 warning sign for ZOZO that you need to take into consideration.
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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.