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Genworth Financial, Inc. (NYSE:GNW) Just Reported, And Analysts Assigned A US$4.50 Price Target

Simply Wall St
·3 min read

Shareholders might have noticed that Genworth Financial, Inc. (NYSE:GNW) filed its first-quarter result this time last week. The early response was not positive, with shares down 9.7% to US$3.06 in the past week. It was an okay result overall, with revenues coming in at US$2.0b, roughly what the analyst had been expecting. This is an important time for investors, as they can track a company's performance in its report, look at what expert is forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analyst latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Genworth Financial

NYSE:GNW Past and Future Earnings May 8th 2020
NYSE:GNW Past and Future Earnings May 8th 2020

Taking into account the latest results, Genworth Financial's one analyst currently expect revenues in 2020 to be US$7.75b, approximately in line with the last 12 months. Prior to the latest earnings, the analyst was forecasting revenues of US$7.89b in 2020, and did not provide an earnings per share estimate. Overall it looks like Genworth Financial is performing in line with expectations, giventhe analyst has updated their numbers and there's been no real change to next year's forecast following these results.

Intriguingly,the analyst has cut their price target 5.3% to US$4.50 showing a clear decline in sentiment around Genworth Financial's valuation.

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. One more thing stood out to us about these estimates, and it's the idea that Genworth Financial'sdecline is expected to accelerate, with revenues forecast to fall 1.8% next year, topping off a historical decline of 1.3% a year over the past five years. Compare this against analyst estimates for companies in the wider industry, which suggest that revenues (in aggregate) are expected to grow 3.0% next year. So while a broad number of companies are forecast to decline, unfortunately Genworth Financial is expected to see its sales affected worse than other companies in the industry.

The Bottom Line

The clear take away from these updates is that the analyst made no change to their revenue estimates for next year, with the business apparently performing in line with their models. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse than the wider industry. Furthermore, the analyst also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

One Genworth Financial broker/analyst has provided estimates out to 2021, which can be seen for free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for Genworth Financial you should be aware of.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.