Ryohin Keikaku Co., Ltd. Just Recorded A 7.9% EPS Beat: Here's What Analysts Are Forecasting Next

Ryohin Keikaku Co., Ltd. (TSE:7453) shareholders are probably feeling a little disappointed, since its shares fell 7.9% to JP¥6,665 in the week after its latest quarterly results. Ryohin Keikaku reported JP¥209b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of JP¥68.31 beat expectations, being 7.9% 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

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Following the latest results, Ryohin Keikaku's 14 analysts are now forecasting revenues of JP¥854.5b in 2026. This would be a solid 13% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to rise 7.4% to JP¥209. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥853.2b and earnings per share (EPS) of JP¥208 in 2026. 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.

See our latest analysis for Ryohin Keikaku

The analysts reconfirmed their price target of JP¥6,536, showing that the business is executing well and in line with expectations. 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 Ryohin Keikaku analyst has a price target of JP¥8,400 per share, while the most pessimistic values it at JP¥3,600. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that Ryohin Keikaku's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 10% growth on an annualised basis. This is compared to a historical growth rate of 13% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 5.6% per year. So it's pretty clear that, while Ryohin Keikaku'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. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at JP¥6,536, with the latest estimates not enough to have an impact on their price targets.

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 Ryohin Keikaku analysts - going out to 2027, and you can see them free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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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.