Analysts Just Made A Neat Upgrade To Their Coastal Financial Corporation (NASDAQ:CCB) Forecasts

Coastal Financial Corporation (NASDAQ:CCB) shareholders will have a reason to smile today, with the analysts making substantial upgrades to next year's statutory forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals. Coastal Financial has also found favour with investors, with the stock up a remarkable 15% to US$46.70 over the past week. It will be interesting to see if today's upgrade is enough to propel the stock even higher.

Following the upgrade, the latest consensus from Coastal Financial's four analysts is for revenues of US$408m in 2023, which would reflect a major 121% improvement in sales compared to the last 12 months. Per-share earnings are expected to shoot up 52% to US$4.09. Prior to this update, the analysts had been forecasting revenues of US$360m and earnings per share (EPS) of US$3.68 in 2023. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.

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With these upgrades, we're not surprised to see that the analysts have lifted their price target 5.2% to US$62.75 per share. 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. Currently, the most bullish analyst values Coastal Financial at US$74.00 per share, while the most bearish prices it at US$50.00. 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.

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 clear from the latest estimates that Coastal Financial's rate of growth is expected to accelerate meaningfully, with the forecast 88% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 35% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 6.2% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Coastal Financial is expected to grow much faster than its industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for next year. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Coastal 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 Coastal Financial analysts - going out to 2024, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks 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.