Industry Analysts Just Made A Captivating Upgrade To Their Walker & Dunlop, Inc. (NYSE:WD) Revenue Forecasts
Celebrations may be in order for Walker & Dunlop, Inc. (NYSE:WD) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects.
Following the upgrade, the latest consensus from Walker & Dunlop's four analysts is for revenues of US$1.5b in 2022, which would reflect a meaningful 15% improvement in sales compared to the last 12 months. Per-share earnings are expected to ascend 19% to US$9.85. Previously, the analysts had been modelling revenues of US$1.3b and earnings per share (EPS) of US$9.20 in 2022. The forecasts seem more optimistic now, with a decent improvement in revenue and a modest lift to earnings per share estimates.
Check out our latest analysis for Walker & Dunlop
Despite these upgrades, the analysts have not made any major changes to their price target of US$171, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Walker & Dunlop at US$191 per share, while the most bearish prices it at US$160. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or that the analysts have a clear view on its prospects.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Walker & Dunlop's past performance and to peers in the same industry. We can infer from the latest estimates that forecasts expect a continuation of Walker & Dunlop'shistorical trends, as the 15% annualised revenue growth to the end of 2022 is roughly in line with the 14% annual revenue growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue shrink 2.0% annually. So it's clear that not only is revenue growth expected to be maintained, but Walker & Dunlop is expected to grow meaningfully 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. On the plus side, they also lifted their revenue estimates, and the company is expected to perform better than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Walker & Dunlop.
Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have estimates - from multiple Walker & Dunlop analysts - going out to 2024, and you can see them free on our platform here.
Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.
