Last week, you might have seen that Boston Private Financial Holdings, Inc. (NASDAQ:BPFH) released its yearly result to the market. The early response was not positive, with shares down 3.1% to US$11.89 in the past week. Boston Private Financial Holdings reported US$333m in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$0.97 beat expectations, being 4.3% higher than what analysts expected. This is an important time for investors, as they can track a company's performance in its report, look at what top analysts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what analysts' statutory forecasts suggest is in store for next year.
Following last week's earnings report, Boston Private Financial Holdings's four analysts are forecasting 2020 revenues to be US$336.0m, approximately in line with the last 12 months. Statutory earnings per share are expected to decrease 8.5% to US$0.89 in the same period. Yet prior to the latest earnings, analysts had been forecasting revenues of US$335.0m and earnings per share (EPS) of US$0.96 in 2020. Analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share forecasts for next year.
It might be a surprise to learn that the consensus price target was broadly unchanged at US$12.25, with analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Boston Private Financial Holdings analyst has a price target of US$13.00 per share, while the most pessimistic values it at US$12.00. Still, with such a tight range of estimates, it suggests analysts have a pretty good idea of what they think the company is worth.
Zooming out to look at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up both against past performance, and against industry growth estimates. It's pretty clear that analysts expect Boston Private Financial Holdings's revenue growth will slow down substantially, with revenues next year expected to grow 0.8%, compared to a historical growth rate of 1.9% over the past five years. Compare this against other companies (with analyst forecasts) in the market, which are in aggregate expected to see revenue growth of 4.9% next year. So it's pretty clear that, while revenue growth is expected to slow down, analysts still expect the wider market to grow faster than Boston Private Financial Holdings.
The Bottom Line
The most important thing to take away is that analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that Boston Private Financial Holdings's revenues are expected to perform worse than the wider market. The consensus price target held steady at US$12.25, with the latest estimates not enough to have an impact on analysts' estimated valuations.
Still, the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Boston Private Financial Holdings going out to 2021, and you can see them free on our platform here..
It might also be worth considering whether Boston Private Financial Holdings's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.
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