Donegal Group Inc. (NASDAQ:DGIC.B) last week reported its latest annual results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. It was an okay report, and revenues came in at US$812m, approximately in line with analyst estimates leading up to the results announcement. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether analysts have changed their mind on Donegal Group after the latest results.
Following last week's earnings report, Donegal Group's only analyst are forecasting 2020 revenues to be US$807.3m, approximately in line with the last 12 months. Before this earnings result, analysts had predicted US$811.7m revenue in 2020, although there was no accompanying EPS estimate. From what we can see of these results, it looks like Donegal Group is performing in line with analyst expectations. The analysts we track have all updated their numbers following the results, and there were no major changes to their forecasts for next year.
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. These estimates imply that sales are expected to slow, with a forecast revenue decline of 0.6% a significant reduction from annual growth of 6.6% over the last five years. Compare this with our data, which suggests that other companies in the same market are, in aggregate, expected to see their revenue grow 1.0% next year. It's pretty clear that Donegal Group's revenues are expected to perform substantially worse than the wider market.
The Bottom Line
Probably the biggest thing to take away from these latest forecasts is that brokers are definitely optimistic on the business, given the forecast for profitability next year. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that Donegal Group's revenues are expected to perform worse than the wider market. The stock price is largely unchanged in the week since results came out, suggesting that the earnings report did not have much of an impact on market perception of the business.
We have estimates for Donegal Group from one covering analyst, and you can see them free on our platform here.
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