As you might know, Allegiance Bancshares, Inc. (NASDAQ:ABTX) recently reported its third-quarter numbers. Revenues were US$54m, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$0.79, an impressive 56% ahead of estimates. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the consensus forecast from Allegiance Bancshares' four analysts is for revenues of US$218.1m in 2021, which would reflect a substantial 23% improvement in sales compared to the last 12 months. Statutory per-share earnings are expected to be US$2.09, roughly flat on the last 12 months. Before this earnings report, the analysts had been forecasting revenues of US$215.0m and earnings per share (EPS) of US$1.81 in 2021. Although the revenue estimates have not really changed, we can see there's been a solid gain to earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.
There's been no major changes to the consensus price target of US$29.00, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. 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. Currently, the most bullish analyst values Allegiance Bancshares at US$32.00 per share, while the most bearish prices it at US$26.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business 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. Next year brings more of the same, according to the analysts, with revenue forecast to grow 23%, in line with its 21% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 1.2% per year. So it's pretty clear that Allegiance Bancshares is forecast to grow substantially faster than its industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Allegiance Bancshares' earnings potential next year. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider 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 Allegiance Bancshares. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Allegiance Bancshares going out to 2022, and you can see them free on our platform here..
We also provide an overview of the Allegiance Bancshares Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.
This article by Simply Wall St is general in nature. 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.
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