Rakus Co., Ltd. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

Explore Rakus's Fair Values from the Community and select yours

Investors in Rakus Co., Ltd. (TSE:3923) had a good week, as its shares rose 8.1% to close at JP¥2,546 following the release of its first-quarter results. It looks like a credible result overall - although revenues of JP¥14b were in line with what the analysts predicted, Rakus surprised by delivering a statutory profit of JP¥19.57 per share, a notable 18% above expectations. 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 collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality.

Taking into account the latest results, the current consensus from Rakus' eight analysts is for revenues of JP¥59.7b in 2026. This would reflect a solid 15% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to jump 27% to JP¥66.73. Before this earnings report, the analysts had been forecasting revenues of JP¥59.6b and earnings per share (EPS) of JP¥65.64 in 2026. 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.

See our latest analysis for Rakus

The analysts reconfirmed their price target of JP¥2,700, showing that the business is executing well and in line with expectations. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Rakus, with the most bullish analyst valuing it at JP¥3,200 and the most bearish at JP¥2,300 per share. 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.

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. We would highlight that Rakus' revenue growth is expected to slow, with the forecast 21% annualised growth rate until the end of 2026 being well below the historical 28% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 11% per year. Even after the forecast slowdown in growth, it seems obvious that Rakus is also expected to grow faster than the wider industry.

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, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at JP¥2,700, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Rakus. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Rakus analysts - going out to 2028, and you can see them free on our platform here.

We also provide an overview of the Rakus Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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.