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A week ago, Citizens Community Bancorp, Inc. (NASDAQ:CZWI) came out with a strong set of quarterly numbers that could potentially lead to a re-rate of the stock. It was overall a positive result, with revenues beating expectations by 6.1% to hit US$17m. Citizens Community Bancorp also reported a statutory profit of US$0.31, which was an impressive 48% above what the analysts had forecast. 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.
After the latest results, the three analysts covering Citizens Community Bancorp are now predicting revenues of US$61.7m in 2021. If met, this would reflect a meaningful 8.2% improvement in sales compared to the last 12 months. Statutory earnings per share are forecast to descend 11% to US$0.98 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$62.6m and earnings per share (EPS) of US$1.06 in 2021. The 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 numbers for next year.
It might be a surprise to learn that the consensus price target was broadly unchanged at US$11.17, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on 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 Citizens Community Bancorp at US$11.50 per share, while the most bearish prices it at US$10.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Citizens Community Bancorp is an easy business to forecast or the the analysts are all using similar assumptions.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Citizens Community Bancorp's revenue growth is expected to slow, with forecast 8.2% increase next year well below the historical 23%p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 6.5% next year. Even after the forecast slowdown in growth, it seems obvious that Citizens Community Bancorp is also expected to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. 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. The consensus price target held steady at US$11.17, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Citizens Community Bancorp analysts - going out to 2022, and you can see them free on our platform here.
However, before you get too enthused, we've discovered 3 warning signs for Citizens Community Bancorp (1 is potentially serious!) that you should be aware of.
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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