Industry Analysts Just Made A Captivating Upgrade To Their Manulife Financial Corporation (TSE:MFC) Revenue Forecasts

Celebrations may be in order for Manulife Financial Corporation (TSE:MFC) 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 current consensus from Manulife Financial's twelve analysts is for revenues of CA$67b in 2023 which - if met - would reflect a substantial 258% increase on its sales over the past 12 months. Statutory earnings per share are supposed to nosedive 41% to CA$3.07 in the same period. Prior to this update, the analysts had been forecasting revenues of CA$53b and earnings per share (EPS) of CA$3.25 in 2023. While revenue forecasts have increased, the analysts if anything seem a little more pessimistic, given the minor downgrade to earnings per share estimates in this update.

View our latest analysis for Manulife Financial

The consensus price target was unchanged at CA$29.13, suggesting the business is performing roughly in line with expectations, despite some adjustments to profit and revenue forecasts. 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. The most optimistic Manulife Financial analyst has a price target of CA$35.00 per share, while the most pessimistic values it at CA$25.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

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. One thing stands out from these estimates, which is that Manulife Financial is forecast to grow faster in the future than it has in the past, with revenues expected to display 4x annualised growth until the end of 2023. If achieved, this would be a much better result than the 10% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 9.0% per year. Not only are Manulife Financial's revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Manulife Financial. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Manulife Financial.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have estimates - from multiple Manulife Financial analysts - going out to 2025, 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.