Earnings Miss: SG Holdings Co.,Ltd. Missed EPS By 5.2% And Analysts Are Revising Their Forecasts

There's been a notable change in appetite for SG Holdings Co.,Ltd. (TSE:9143) shares in the week since its yearly report, with the stock down 10% to JP¥1,626. It looks like the results were a bit of a negative overall. While revenues of JP¥1.3t were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 5.2% to hit JP¥92.98 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 SG HoldingsLtd

Taking into account the latest results, the consensus forecast from SG HoldingsLtd's eight analysts is for revenues of JP¥1.37t in 2025. This reflects a modest 4.1% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to grow 15% to JP¥108. In the lead-up to this report, the analysts had been modelling revenues of JP¥1.36t and earnings per share (EPS) of JP¥116 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at JP¥2,158, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values SG HoldingsLtd at JP¥2,500 per share, while the most bearish prices it at JP¥1,800. 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. The period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 4.1% growth on an annualised basis. That is in line with its 5.0% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 3.8% per year. It's clear that while SG HoldingsLtd's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for SG HoldingsLtd. 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 said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for SG HoldingsLtd going out to 2027, and you can see them free on our platform here.

Plus, you should also learn about the 2 warning signs we've spotted with SG HoldingsLtd .

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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.