SCREEN Holdings Co., Ltd. Just Missed Earnings - But Analysts Have Updated Their Models

SCREEN Holdings Co., Ltd. (TSE:7735) shareholders are probably feeling a little disappointed, since its shares fell 9.9% to JP¥11,810 in the week after its latest first-quarter results. SCREEN Holdings beat revenue expectations by 2.2%, at JP¥134b. Statutory earnings per share (EPS) came in at JP¥188, some 7.0% short of analyst estimates. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for SCREEN Holdings

Following the latest results, SCREEN Holdings' 14 analysts are now forecasting revenues of JP¥570.4b in 2025. This would be a reasonable 5.7% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to dip 2.4% to JP¥797 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥564.3b and earnings per share (EPS) of JP¥790 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.

The consensus price target fell 5.1% to JP¥17,773, suggesting that the analysts might have been a bit enthusiastic in their previous valuation - or they were expecting the company to provide stronger guidance in the quarterly results. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on SCREEN Holdings, with the most bullish analyst valuing it at JP¥24,350 and the most bearish at JP¥13,500 per share. 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.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the SCREEN Holdings' past performance and to peers in the same industry. It's pretty clear that there is an expectation that SCREEN Holdings' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 7.7% growth on an annualised basis. This is compared to a historical growth rate of 11% 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 12% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than SCREEN Holdings.

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. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that SCREEN Holdings' revenue is expected to perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

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

You still need to take note of risks, for example - SCREEN Holdings has 4 warning signs (and 1 which doesn't sit too well with us) we think you should know about.

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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.

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