SpareBank 1 SR-Bank ASA Just Recorded A 7.0% Revenue Beat: Here's What Analysts Think

SpareBank 1 SR-Bank ASA (OB:SRBNK) just released its full-year report and things are looking bullish. The company beat expectations with revenues of kr9.0b arriving 7.0% ahead of forecasts. Statutory earnings per share (EPS) were kr16.27, 4.9% ahead of estimates. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for SpareBank 1 SR-Bank

Following the latest results, SpareBank 1 SR-Bank's four analysts are now forecasting revenues of kr9.62b in 2024. This would be a credible 7.2% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to reduce 3.0% to kr15.79 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of kr9.24b and earnings per share (EPS) of kr15.88 in 2024. So it looks like there's been no major change in sentiment following the latest results, although the analysts have made a slight bump in to revenue forecasts.

Even though revenue forecasts increased, there was no change to the consensus price target of kr150, suggesting the analysts are focused on earnings as the driver of value creation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on SpareBank 1 SR-Bank, with the most bullish analyst valuing it at kr163 and the most bearish at kr145 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that SpareBank 1 SR-Bank's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 7.2% growth on an annualised basis. This is compared to a historical growth rate of 9.7% 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 1.5% annually. So it's pretty clear that, while SpareBank 1 SR-Bank's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. The consensus price target held steady at kr150, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple SpareBank 1 SR-Bank analysts - going out to 2026, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 3 warning signs for SpareBank 1 SR-Bank (of which 1 can't be ignored!) you should know about.

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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.