The yearly results for National General Holdings Corp. (NASDAQ:NGHC) were released last week, making it a good time to revisit its performance. The result was fairly weak overall, with revenues of US$5.2b being 7.5% less than what analysts had been modelling. Analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the current consensus from National General Holdings's dual analysts is for revenues of US$5.90b in 2020, which would reflect a notable 15% increase on its sales over the past 12 months. Before this earnings result, analysts had predicted US$6.07b revenue in 2020, although there was no accompanying EPS estimate. It looks like analysts have become a bit less bullish on National General Holdings, given the revenue estimates after the latest results.
We'd also point out that that analysts have made no major changes to their price target of US$29.67.
It can be useful to take a broader overview by seeing how analyst forecasts compare, both to the National General Holdings's past performance and to peers in the same market. It's pretty clear that analysts expect National General Holdings's revenue growth will slow down substantially, with revenues next year expected to grow 15%, compared to a historical growth rate of 18% over the past five years. By way of comparison, other companies in this market with analyst coverage, are forecast to grow their revenue at 0.9% next year. Even after the forecast slowdown in growth, it seems obvious that analysts still thinkNational General Holdings will grow faster than the wider market.
The Bottom Line
Probably the biggest thing to take away from these latest forecasts is that brokers are definitely optimistic on the business, given the forecast for profitability next year. Unfortunately analysts also downgraded their revenue estimates, although industry data suggests that National General Holdings's revenues are expected to grow faster than the wider market. The consensus price target held steady at US$29.67, with the latest estimates not enough to have an impact on analysts' estimated valuations.
At least one of National General Holdings's dual analysts has provided estimates out to 2022, which can be seen for free on our platform here.
You can also see whether National General Holdings is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
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