Here's What Analysts Are Forecasting For City Holding Company (NASDAQ:CHCO) After Its Yearly Results

Last week saw the newest annual earnings release from City Holding Company (NASDAQ:CHCO), an important milestone in the company's journey to build a stronger business. Results look mixed - while revenue fell marginally short of analyst estimates at US$287m, statutory earnings were in line with expectations, at US$7.61 per share. 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.

View our latest analysis for City Holding

Following last week's earnings report, City Holding's five analysts are forecasting 2024 revenues to be US$289.5m, approximately in line with the last 12 months. Statutory per-share earnings are expected to be US$7.52, roughly flat on the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of US$288.6m and earnings per share (EPS) of US$7.25 in 2024. So the consensus seems to have become somewhat more optimistic on City Holding's earnings potential following these results.

There's been no major changes to the consensus price target of US$103, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic City Holding analyst has a price target of US$113 per share, while the most pessimistic values it at US$95.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the City Holding's past performance and to peers in the same industry. We would highlight that City Holding's revenue growth is expected to slow, with the forecast 1.0% annualised growth rate until the end of 2024 being well below the historical 5.4% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 5.6% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than City Holding.

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 City Holding following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that City Holding's revenue is expected to perform worse 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for City Holding going out to 2025, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for City Holding (of which 1 doesn't sit too well with us!) 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.