Shareholders might have noticed that Bank7 Corp. (NASDAQ:BSVN) filed its quarterly result this time last week. The early response was not positive, with shares down 5.0% to US$9.07 in the past week. The result was positive overall - although revenues of US$12m were in line with what the analysts predicted, Bank7 surprised by delivering a statutory profit of US$0.48 per share, modestly greater than expected. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the consensus forecast from Bank7's three analysts is for revenues of US$45.3m in 2021, which would reflect an okay 4.1% improvement in sales compared to the last 12 months. Statutory earnings per share are forecast to tumble 31% to US$1.42 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$45.8m and earnings per share (EPS) of US$1.45 in 2021. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$12.33. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Bank7, with the most bullish analyst valuing it at US$13.00 and the most bearish at US$12.00 per share. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Bank7 is an easy business to forecast or the the analysts are all using similar assumptions.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Bank7's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Bank7's revenue growth will slow down substantially, with revenues next year expected to grow 4.1%, compared to a historical growth rate of 6.2% over the past three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 1.2% next year. Even after the forecast slowdown in growth, it seems obvious that Bank7 is also expected to grow faster than the wider industry.
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. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
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 forecasts for Bank7 going out to 2022, and you can see them free on our platform here.
Plus, you should also learn about the 4 warning signs we've spotted with Bank7 (including 1 which doesn't sit too well with us) .
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