Forecast: Analysts Think Inter Action Corporation's (TSE:7725) Business Prospects Have Improved Drastically

Celebrations may be in order for Inter Action Corporation (TSE:7725) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals. The market may be pricing in some blue sky too, with the share price gaining 24% to JP¥1,601 in the last 7 days. Could this upgrade be enough to drive the stock even higher?

After this upgrade, Inter Action's three analysts are now forecasting revenues of JP¥8.3b in 2025. This would be a major 25% improvement in sales compared to the last 12 months. Per-share earnings are expected to soar 51% to JP¥99.80. Prior to this update, the analysts had been forecasting revenues of JP¥7.5b and earnings per share (EPS) of JP¥79.90 in 2025. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.

See our latest analysis for Inter Action

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. One thing stands out from these estimates, which is that Inter Action is forecast to grow faster in the future than it has in the past, with revenues expected to display 20% annualised growth until the end of 2025. If achieved, this would be a much better result than the 4.0% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 13% annually. Not only are Inter Action's revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for next year, expecting improving business conditions. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. The clear improvement in sentiment should be enough to get most shareholders feeling more optimistic about Inter Action's future.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Inter Action analysts - going out to 2026, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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.