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The Hartford Financial Services Group, Inc. Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

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Simply Wall St
·4 min read
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The Hartford Financial Services Group, Inc. (NYSE:HIG) last week reported its latest third-quarter results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. It looks like a credible result overall - although revenues of US$5.2b were what the analysts expected, Hartford Financial Services Group surprised by delivering a (statutory) profit of US$1.26 per share, an impressive 42% above what was 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Hartford Financial Services Group

earnings-and-revenue-growth
earnings-and-revenue-growth

Taking into account the latest results, Hartford Financial Services Group's ten analysts currently expect revenues in 2022 to be US$20.8b, approximately in line with the last 12 months. Per-share earnings are expected to accumulate 3.8% to US$5.19. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$21.4b and earnings per share (EPS) of US$5.17 in 2022. So it looks like the analysts have become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.

The consensus has reconfirmed its price target of US$52.00, showing that the analysts don't expect weaker sales expectations next year to have a material impact on Hartford Financial Services Group's market value. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Hartford Financial Services Group at US$64.00 per share, while the most bearish prices it at US$43.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

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 pretty clear that there is an expectation that Hartford Financial Services Group's revenue growth will slow down substantially, with revenues next year expected to grow 0.3%, compared to a historical growth rate of 4.6% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.8% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Hartford Financial Services Group.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. On the negative side, they also downgraded their revenue estimates, and forecasts imply revenues will perform worse than the wider industry. Still, earnings per share are more important to value creation for shareholders. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Hartford Financial Services Group going out to 2022, and you can see them free on our platform here..

It might also be worth considering whether Hartford Financial Services Group's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.