SHIFT Inc. Just Missed EPS By 15%: Here's What Analysts Think Will Happen Next

It's been a mediocre week for SHIFT Inc. (TSE:3697) shareholders, with the stock dropping 13% to JP¥18,615 in the week since its latest half-year results. It was not a great result overall. While revenues of JP¥27b were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 15% to hit JP¥107 per share. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for SHIFT

Taking into account the latest results, the current consensus from SHIFT's eight analysts is for revenues of JP¥116.8b in 2024. This would reflect a notable 17% increase on its revenue over the past 12 months. Per-share earnings are expected to soar 24% to JP¥497. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥117.1b and earnings per share (EPS) of JP¥505 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

The consensus price target fell 5.0% to JP¥32,060, 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 semi-annual results. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values SHIFT at JP¥39,000 per share, while the most bearish prices it at JP¥26,300. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We can infer from the latest estimates that forecasts expect a continuation of SHIFT'shistorical trends, as the 36% annualised revenue growth to the end of 2024 is roughly in line with the 34% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 5.1% annually. So although SHIFT is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster 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 SHIFT going out to 2026, and you can see them free on our platform here..

Before you take the next step you should know about the 1 warning sign for SHIFT that we have uncovered.

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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.