The analysts might have been a bit too bullish on Civista Bancshares, Inc. (NASDAQ:CIVB), given that the company fell short of expectations when it released its quarterly results last week. Civista Bancshares missed analyst forecasts, with revenues of US$31m and statutory earnings per share (EPS) of US$0.57, falling short by 3.8% and 9.3% respectively. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the most recent consensus for Civista Bancshares from five analysts is for revenues of US$132.1m in 2022 which, if met, would be a credible 6.4% increase on its sales over the past 12 months. Statutory earnings per share are expected to decrease 9.8% to US$2.32 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$133.8m and earnings per share (EPS) of US$2.34 in 2022. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$29.17. 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 Civista Bancshares at US$33.00 per share, while the most bearish prices it at US$25.50. This is a very narrow spread of estimates, implying either that Civista Bancshares is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Civista Bancshares' revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 8.7% growth on an annualised basis. This is compared to a historical growth rate of 14% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.7% annually. So it's pretty clear that, while Civista Bancshares' revenue growth is expected to slow, it's expected to grow roughly in line with the 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. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall industry. The consensus price target held steady at US$29.17, 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 Civista Bancshares going out to 2024, and you can see them free on our platform here..
And what about risks? Every company has them, and we've spotted 1 warning sign for Civista Bancshares you should know about.
What are the risks and opportunities for Civista Bancshares?
Trading at 60.3% below our estimate of its fair value
Earnings are forecast to grow 13.83% per year
Shareholders have been diluted in the past year
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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.