Earnings Miss: Independent Bank Group, Inc. Missed EPS By 20% And Analysts Are Revising Their Forecasts

As you might know, Independent Bank Group, Inc. (NASDAQ:IBTX) last week released its latest annual, and things did not turn out so great for shareholders. Results showed a clear earnings miss, with US$504m revenue coming in 2.4% lower than what the analystsexpected. Statutory earnings per share (EPS) of US$1.04 missed the mark badly, arriving some 20% below what was 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Independent Bank Group

Taking into account the latest results, the most recent consensus for Independent Bank Group from seven analysts is for revenues of US$527.6m in 2024. If met, it would imply a satisfactory 4.7% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to surge 186% to US$3.00. In the lead-up to this report, the analysts had been modelling revenues of US$526.3m and earnings per share (EPS) of US$2.98 in 2024. 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.

With the analysts reconfirming their revenue and earnings forecasts, it's surprising to see that the price target rose 13% to US$56.00. It looks as though they previously had some doubts over whether the business would live up to their expectations. 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. The most optimistic Independent Bank Group analyst has a price target of US$60.00 per share, while the most pessimistic values it at US$53.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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. We can infer from the latest estimates that forecasts expect a continuation of Independent Bank Group'shistorical trends, as the 4.7% annualised revenue growth to the end of 2024 is roughly in line with the 4.6% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 5.4% annually. It's clear that while Independent Bank Group's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

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 estimates - from multiple Independent Bank Group analysts - going out to 2025, and you can see them free on our platform here.

Even so, be aware that Independent Bank Group is showing 3 warning signs in our investment analysis , 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.