The Bank of N.T. Butterfield & Son Limited (NYSE:NTB) Annual Results: Here's What Analysts Are Forecasting For This Year
It's been a good week for The Bank of N.T. Butterfield & Son Limited (NYSE:NTB) shareholders, because the company has just released its latest full-year results, and the shares gained 2.4% to US$30.13. Bank of N.T. Butterfield & Son reported in line with analyst predictions, delivering revenues of US$579m and statutory earnings per share of US$4.58, suggesting the business is executing well and in line with its plan. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
View our latest analysis for Bank of N.T. Butterfield & Son
Following the recent earnings report, the consensus from five analysts covering Bank of N.T. Butterfield & Son is for revenues of US$558.3m in 2024. This implies a perceptible 3.5% decline in revenue compared to the last 12 months. Statutory earnings per share are expected to shrink 9.5% to US$4.25 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$558.3m and earnings per share (EPS) of US$4.38 in 2024. 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 minor downgrade to their earnings per share forecasts.
It might be a surprise to learn that the consensus price target was broadly unchanged at US$35.20, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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. There are some variant perceptions on Bank of N.T. Butterfield & Son, with the most bullish analyst valuing it at US$40.00 and the most bearish at US$32.00 per share. 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. We would highlight that revenue is expected to reverse, with a forecast 3.5% annualised decline to the end of 2024. That is a notable change from historical growth of 1.8% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.8% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Bank of N.T. Butterfield & Son is expected to lag the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Bank of N.T. Butterfield & Son. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$35.20, with the latest estimates not enough to have an impact on their price targets.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Bank of N.T. Butterfield & Son going out to 2025, and you can see them free on our platform here.
We don't want to rain on the parade too much, but we did also find 2 warning signs for Bank of N.T. Butterfield & Son (1 is a bit concerning!) that you need to be mindful 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.
