East Japan Railway Company (TSE:9020) Yearly Results: Here's What Analysts Are Forecasting For This Year

Investors in East Japan Railway Company (TSE:9020) had a good week, as its shares rose 5.8% to close at JP¥3,256 following the release of its annual results. It was a credible result overall, with revenues of JP¥2.9t and statutory earnings per share of JP¥198 both in line with analyst estimates, showing that East Japan Railway is executing in line with expectations. 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.

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Taking into account the latest results, the most recent consensus for East Japan Railway from eleven analysts is for revenues of JP¥2.99t in 2026. If met, it would imply a satisfactory 3.4% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to accumulate 6.2% to JP¥211. In the lead-up to this report, the analysts had been modelling revenues of JP¥2.99t and earnings per share (EPS) of JP¥210 in 2026. 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.

Check out our latest analysis for East Japan Railway

The analysts reconfirmed their price target of JP¥3,267, 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. The most optimistic East Japan Railway analyst has a price target of JP¥4,000 per share, while the most pessimistic values it at JP¥2,700. 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. It's pretty clear that there is an expectation that East Japan Railway's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 3.4% growth on an annualised basis. This is compared to a historical growth rate of 6.2% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 2.4% per year. So it's pretty clear that, while East Japan Railway's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

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. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

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

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with East Japan Railway (at least 1 which is a bit unpleasant) , and understanding these should be part of your investment process.

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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.