Central Japan Railway Company Beat Analyst Estimates: See What The Consensus Is Forecasting For This Year

Central Japan Railway Company (TSE:9022) investors will be delighted, with the company turning in some strong numbers with its latest results. Central Japan Railway beat earnings, with revenues hitting JP¥478b, ahead of expectations, and statutory earnings per share outperforming analyst reckonings by a solid 12%. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Central Japan Railway after the latest results.

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Following last week's earnings report, Central Japan Railway's twelve analysts are forecasting 2026 revenues to be JP¥1.91t, approximately in line with the last 12 months. Statutory earnings per share are forecast to reduce 4.0% to JP¥475 in the same period. Before this earnings report, the analysts had been forecasting revenues of JP¥1.90t and earnings per share (EPS) of JP¥465 in 2026. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

View our latest analysis for Central Japan Railway

The consensus price target was unchanged at JP¥3,663, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 Central Japan Railway analyst has a price target of JP¥4,600 per share, while the most pessimistic values it at JP¥3,000. 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.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Central Japan Railway's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 2.4% growth on an annualised basis. This is compared to a historical growth rate of 14% 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) 2.2% annually. So it's pretty clear that, while Central Japan Railway's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Central Japan Railway following these results. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall 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 Central Japan Railway. Long-term earnings power is much more important than next year's profits. We have forecasts for Central Japan Railway going out to 2028, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 2 warning signs for Central Japan Railway you should be aware of.

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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.