Earnings Miss: Japan Airlines Co., Ltd. Missed EPS By 8.3% And Analysts Are Revising Their Forecasts

Last week, you might have seen that Japan Airlines Co., Ltd. (TSE:9201) released its quarterly result to the market. The early response was not positive, with shares down 4.0% to JP¥2,321 in the past week. It looks like the results were a bit of a negative overall. While revenues of JP¥424b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 8.3% to hit JP¥32.00 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Japan Airlines

Taking into account the latest results, the current consensus from Japan Airlines' ten analysts is for revenues of JP¥1.89t in 2025. This would reflect a decent 9.4% increase on its revenue over the past 12 months. Per-share earnings are expected to swell 19% to JP¥235. Yet prior to the latest earnings, the analysts had been anticipated revenues of JP¥1.89t and earnings per share (EPS) of JP¥237 in 2025. 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.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at JP¥3,131. 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 Japan Airlines at JP¥3,600 per share, while the most bearish prices it at JP¥2,700. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that Japan Airlines' rate of growth is expected to accelerate meaningfully, with the forecast 13% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 6.9% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 6.3% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Japan Airlines 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. 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¥3,131, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Japan Airlines analysts - going out to 2027, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for Japan Airlines 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com