This Broker Just Slashed Their DIGITAL HEARTS HOLDINGS Co., Ltd. (TSE:3676) Earnings Forecasts

The analyst covering DIGITAL HEARTS HOLDINGS Co., Ltd. (TSE:3676) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analyst seeing grey clouds on the horizon.

We've discovered 1 warning sign about DIGITAL HEARTS HOLDINGS. View them for free.

Following this downgrade, DIGITAL HEARTS HOLDINGS' single analyst are forecasting 2026 revenues to be JP¥40b, approximately in line with the last 12 months. Per-share earnings are expected to jump 186% to JP¥80.80. Prior to this update, the analyst had been forecasting revenues of JP¥45b and earnings per share (EPS) of JP¥108 in 2026. It looks like analyst sentiment has declined substantially, with a substantial drop in revenue estimates and a pretty serious decline to earnings per share numbers as well.

Check out our latest analysis for DIGITAL HEARTS HOLDINGS

The consensus price target fell 21% to JP¥1,500, with the weaker earnings outlook clearly leading analyst valuation estimates.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the DIGITAL HEARTS HOLDINGS' past performance and to peers in the same industry. We would highlight that DIGITAL HEARTS HOLDINGS' revenue growth is expected to slow, with the forecast 0.1% annualised growth rate until the end of 2026 being well below the historical 15% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.8% per year. Factoring in the forecast slowdown in growth, it seems obvious that DIGITAL HEARTS HOLDINGS is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that the analyst cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately the analyst also downgraded their revenue estimates, and industry data suggests that DIGITAL HEARTS HOLDINGS' revenues are expected to grow slower than the wider market. With a serious cut to this year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of DIGITAL HEARTS HOLDINGS.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At least one analyst has provided forecasts out to 2028, which can be seen for 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 backed by insiders.

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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.