Earnings Update: LINTEC Corporation (TSE:7966) Just Reported Its First-Quarter Results And Analysts Are Updating Their Forecasts
LINTEC Corporation (TSE:7966) shareholders are probably feeling a little disappointed, since its shares fell 2.1% to JP¥6,070 in the week after its latest quarterly results. It was a credible result overall, with revenues of JP¥83b and statutory earnings per share of JP¥264 both in line with analyst estimates, showing that LINTEC is executing in line with 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Following the latest results, LINTEC's five analysts are now forecasting revenues of JP¥338.6b in 2027. This would be a reasonable 4.0% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to climb 16% to JP¥335. In the lead-up to this report, the analysts had been modelling revenues of JP¥338.5b and earnings per share (EPS) of JP¥329 in 2027. 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.
View our latest analysis for LINTEC
There were no changes to revenue or earnings estimates or the price target of JP¥6,045, suggesting that the company has met expectations in its recent result. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic LINTEC analyst has a price target of JP¥8,000 per share, while the most pessimistic values it at JP¥3,800. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
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 can infer from the latest estimates that forecasts expect a continuation of LINTEC'shistorical trends, as the 5.4% annualised revenue growth to the end of 2027 is roughly in line with the 5.5% 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 5.0% per year. So although LINTEC is expected to maintain its revenue growth rate, it's only growing at about the rate of 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. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at JP¥6,045, 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 LINTEC. Long-term earnings power is much more important than next year's profits. We have forecasts for LINTEC going out to 2029, and you can see them free on our platform here.
You still need to take note of risks, for example - LINTEC has 2 warning signs we think 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.