Primerica, Inc. (NYSE:PRI) Just Reported Yearly Earnings: Have Analysts Changed Their Mind On The Stock?
It's been a good week for Primerica, Inc. (NYSE:PRI) shareholders, because the company has just released its latest yearly results, and the shares gained 3.8% to US$245. Results were roughly in line with estimates, with revenues of US$2.8b and statutory earnings per share of US$15.94. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
View our latest analysis for Primerica
After the latest results, the five analysts covering Primerica are now predicting revenues of US$2.94b in 2024. If met, this would reflect a credible 4.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to accumulate 8.5% to US$17.86. Before this earnings report, the analysts had been forecasting revenues of US$2.97b and earnings per share (EPS) of US$17.83 in 2024. 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.
The analysts reconfirmed their price target of US$231, showing that the business is executing well and in line with expectations. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Primerica, with the most bullish analyst valuing it at US$275 and the most bearish at US$204 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.
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. It's pretty clear that there is an expectation that Primerica's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 4.4% growth on an annualised basis. This is compared to a historical growth rate of 8.7% 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 6.0% per year. Factoring in the forecast slowdown in growth, it seems obvious that Primerica is also expected to grow slower than other industry participants.
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 plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$231, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Primerica going out to 2026, and you can see them free on our platform here.
You still need to take note of risks, for example - Primerica has 2 warning signs we think you should be aware of.
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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.
