Upgrade: Analysts Just Made A Captivating Increase To Their Customers Bancorp, Inc. (NYSE:CUBI) Forecasts
Customers Bancorp, Inc. (NYSE:CUBI) shareholders will have a reason to smile today, with the analysts making substantial upgrades to next year's forecasts. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with analysts modelling a real improvement in business performance.
Following the upgrade, the latest consensus from Customers Bancorp's six analysts is for revenues of US$430m in 2021, which would reflect a meaningful 9.0% improvement in sales compared to the last 12 months. Per-share earnings are expected to bounce 35% to US$3.85. Before this latest update, the analysts had been forecasting revenues of US$387m and earnings per share (EPS) of US$3.01 in 2021. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.
See our latest analysis for Customers Bancorp
With these upgrades, we're not surprised to see that the analysts have lifted their price target 9.3% to US$19.67 per share. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Customers Bancorp analyst has a price target of US$27.00 per share, while the most pessimistic values it at US$14.00. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.
Of course, another way to look at these forecasts is to place them into context against the industry itself. We can infer from the latest estimates that forecasts expect a continuation of Customers Bancorp'shistorical trends, as next year's 9.0% revenue growth is roughly in line with 8.6% annual revenue growth over the past five years. Compare this with the wider industry, which analyst estimates (in aggregate) suggest will see revenues grow 1.1% next year. So although Customers Bancorp is expected to maintain its revenue growth rate, it's definitely expected to grow 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 next year, expecting improving business conditions. They also upgraded their revenue estimates for next year, and sales are expected to grow faster than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, Customers Bancorp could be worth investigating further.
Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Customers Bancorp analysts - going out to 2022, 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.
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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