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It's been a good week for Independent Bank Corp. (NASDAQ:INDB) shareholders, because the company has just released its latest quarterly results, and the shares gained 9.8% to US$58.12. Revenues were US$120m, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$1.06, an impressive 31% ahead of estimates. 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.
Taking into account the latest results, the most recent consensus for Independent Bank from four analysts is for revenues of US$477.8m in 2021 which, if met, would be a meaningful 10% increase on its sales over the past 12 months. Statutory earnings per share are expected to sink 19% to US$3.22 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$477.8m and earnings per share (EPS) of US$3.25 in 2021. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$71.75. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Independent Bank, with the most bullish analyst valuing it at US$85.00 and the most bearish at US$58.00 per share. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We can infer from the latest estimates that forecasts expect a continuation of Independent Bank'shistorical trends, as next year's 10% revenue growth is roughly in line with 12% annual revenue growth over the past five years. Compare this with the wider industry, which analyst estimates (in aggregate) suggest will see revenues grow 1.4% next year. So it's pretty clear that Independent Bank is forecast to grow substantially faster than its industry.
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. 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. 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 in mind, we wouldn't be too quick to come to a conclusion on Independent Bank. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Independent Bank going out to 2022, and you can see them free on our platform here..
And what about risks? Every company has them, and we've spotted 1 warning sign for Independent Bank you should know about.
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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