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Republic First Bancorp, Inc. (NASDAQ:FRBK) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with analysts modelling a real improvement in business performance. The market seems to be pricing in some improvement in the business too, with the stock up 7.8% over the past week, closing at US$3.99. Could this big upgrade push the stock even higher?
Following the upgrade, the most recent consensus for Republic First Bancorp from its two analysts is for revenues of US$157m in 2021 which, if met, would be a decent 15% increase on its sales over the past 12 months. Statutory earnings per share are anticipated to plummet 41% to US$0.11 in the same period. Prior to this update, the analysts had been forecasting revenues of US$137m and earnings per share (EPS) of US$0.065 in 2021. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's clear from the latest estimates that Republic First Bancorp's rate of growth is expected to accelerate meaningfully, with the forecast 21% annualised revenue growth to the end of 2021 noticeably faster than its historical growth of 17% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 4.6% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Republic First Bancorp to grow faster than the wider industry.
The Bottom Line
The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. The clear improvement in sentiment should be enough to get most shareholders feeling more optimistic about Republic First Bancorp's future.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for Republic First Bancorp going out as far as 2022, and you can see them free on our platform here.
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.
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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