SHIMAMURA Co., Ltd. (TSE:8227) First-Quarter Results Just Came Out: Here's What Analysts Are Forecasting For This Year

SHIMAMURA Co., Ltd. (TSE:8227) came out with its first-quarter results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. The result was positive overall - although revenues of JP¥164b were in line with what the analysts predicted, SHIMAMURA surprised by delivering a statutory profit of JP¥142 per share, modestly greater than expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for SHIMAMURA

Taking into account the latest results, the consensus forecast from SHIMAMURA's ten analysts is for revenues of JP¥658.2b in 2025. This reflects a satisfactory 2.2% improvement in revenue compared to the last 12 months. Statutory per-share earnings are expected to be JP¥552, roughly flat on the last 12 months. Before this earnings report, the analysts had been forecasting revenues of JP¥657.0b and earnings per share (EPS) of JP¥523 in 2025. So the consensus seems to have become somewhat more optimistic on SHIMAMURA's earnings potential following these results.

The consensus price target was unchanged at JP¥8,083, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values SHIMAMURA at JP¥8,700 per share, while the most bearish prices it at JP¥7,200. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

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. It's pretty clear that there is an expectation that SHIMAMURA's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 3.0% growth on an annualised basis. This is compared to a historical growth rate of 4.8% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.7% annually. Factoring in the forecast slowdown in growth, it seems obvious that SHIMAMURA is also expected to grow slower than other industry participants.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around SHIMAMURA'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. 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.

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 SHIMAMURA going out to 2027, and you can see them free on our platform here..

It is also worth noting that we have found 1 warning sign for SHIMAMURA that you need to take into consideration.

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.

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