Commerce Bancshares, Inc. (NASDAQ:CBSH) Yearly Results: Here's What Analysts Are Forecasting For This Year

Investors in Commerce Bancshares, Inc. (NASDAQ:CBSH) had a good week, as its shares rose 3.2% to close at US$54.53 following the release of its annual results. Commerce Bancshares reported in line with analyst predictions, delivering revenues of US$1.6b and statutory earnings per share of US$3.64, suggesting the business is executing well and in line with its plan. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Commerce Bancshares

After the latest results, the seven analysts covering Commerce Bancshares are now predicting revenues of US$1.59b in 2024. If met, this would reflect a credible 2.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to decrease 8.8% to US$3.34 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.54b and earnings per share (EPS) of US$3.17 in 2024. 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.

Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of US$54.71, suggesting that the forecast performance does not have a long term impact on the company's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Commerce Bancshares at US$64.00 per share, while the most bearish prices it at US$46.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

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. It's pretty clear that there is an expectation that Commerce Bancshares' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 2.4% growth on an annualised basis. This is compared to a historical growth rate of 5.0% 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 5.3% annually. Factoring in the forecast slowdown in growth, it seems obvious that Commerce Bancshares is also expected to grow slower than other industry participants.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Commerce Bancshares' earnings potential next year. They also upgraded their revenue estimates for next year, even though it is expected to grow slower than the wider industry. The consensus price target held steady at US$54.71, 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. At Simply Wall St, we have a full range of analyst estimates for Commerce Bancshares going out to 2025, and you can see them free on our platform here..

It is also worth noting that we have found 2 warning signs for Commerce Bancshares (1 is a bit concerning!) that you need to take into consideration.

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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.