SinoPac Financial Holdings Company Limited Beat Revenue Forecasts By 11%: Here's What Analysts Are Forecasting Next

SinoPac Financial Holdings Company Limited (TPE:2890) just released its latest third-quarter results and things are looking bullish. It was a positive result, with revenues and statutory earnings per share (EPS) both performing well. Revenues were 11% higher than the analysts had forecast, at NT$11b, while EPS of NT$0.32 beat analyst models by 4.9%. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for SinoPac Financial Holdings

Following last week's earnings report, SinoPac Financial Holdings' four analysts are forecasting 2021 revenues to be NT$37.4b, approximately in line with the last 12 months. Statutory per share are forecast to be NT$1.11, approximately in line with the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of NT$35.3b and earnings per share (EPS) of NT$1.02 in 2021. It looks like there's been a modest increase in sentiment following the latest results, withthe analysts becoming a bit more optimistic in their predictions for both revenues and earnings.

Despite these upgrades,the analysts have not made any major changes to their price target of NT$12.70, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on SinoPac Financial Holdings, with the most bullish analyst valuing it at NT$14.00 and the most bearish at NT$11.80 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 SinoPac Financial Holdings' revenue growth will slow down substantially, with revenues next year expected to grow 1.7%, compared to a historical growth rate of 3.4% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 2.9% next year. Factoring in the forecast slowdown in growth, it seems obvious that SinoPac Financial Holdings is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards SinoPac Financial Holdings following these results. Fortunately, they also upgraded their revenue estimates, although our data indicates sales are expected to perform worse than the wider industry. The consensus price target held steady at NT$12.70, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on SinoPac Financial Holdings. Long-term earnings power is much more important than next year's profits. We have forecasts for SinoPac Financial Holdings going out to 2022, and you can see them free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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