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Investing.com - JPMorgan has initiated coverage on Japan Aviation Electronics Industry, Limited (6807:JP) (OTC:JPAVF) with a Neutral rating and a price target of JPY2,730.00.
The investment bank expects the company’s fiscal year 2025 earnings to fall slightly below management’s guidance and is waiting for new catalysts that could move the share price.
JPMorgan notes that Japan Aviation Electronics currently trades at approximately 11 times its fiscal year 2026 estimated price-to-earnings ratio on a Bloomberg consensus basis, with a sector-relative P/E of 0.73x as of July 18.
The firm forecasts FY2025 operating profit of JPY17.1 billion, below the company’s guidance of JPY18.5 billion and in line with Bloomberg consensus estimates, assuming an exchange rate of JPY145 to the dollar.
For subsequent years, JPMorgan projects operating profits of JPY20.6 billion in FY2026 and JPY22.7 billion in FY2027, both above current Bloomberg consensus estimates, though the bank believes the company’s FY2025 sales guidance for industrial applications is overly optimistic.
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