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This Just In: Analysts Are Boosting Their Customers Bancorp, Inc. (NYSE:CUBI) Outlook for This Year

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Simply Wall St
·4 min read
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Customers Bancorp, Inc. (NYSE:CUBI) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals. Investor sentiment seems to be improving too, with the share price up 9.3% to US$23.19 over the past 7 days. It will be interesting to see if this latest upgrade is enough to kickstart further buying interest in the stock.

After this upgrade, Customers Bancorp's seven analysts are now forecasting revenues of US$461m in 2021. This would be a satisfactory 4.1% improvement in sales compared to the last 12 months. Per-share earnings are expected to leap 33% to US$4.99. Prior to this update, the analysts had been forecasting revenues of US$415m and earnings per share (EPS) of US$4.03 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.

Check out our latest analysis for Customers Bancorp

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

It will come as no surprise to learn that the analysts have increased their price target for Customers Bancorp 15% to US$28.63 on the back of these upgrades. 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 Customers Bancorp, with the most bullish analyst valuing it at US$35.00 and the most bearish at US$23.00 per share. This shows there is still some 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.

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 Customers Bancorp's revenue growth will slow down substantially, with revenues next year expected to grow 4.1%, compared to a historical growth rate of 8.5% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.6% next 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 Customers Bancorp.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. Pleasantly, analysts also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow slower than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Customers Bancorp.

Analysts are definitely bullish on Customers Bancorp, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including recent substantial insider selling. For more information, you can click through to our platform to learn more about this and the 2 other warning signs we've identified .

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.

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 (at) simplywallst.com.