Earnings Beat: NBT Bancorp Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

Shareholders might have noticed that NBT Bancorp Inc. (NASDAQ:NBTB) filed its quarterly result this time last week. The early response was not positive, with shares down 3.1% to US$35.33 in the past week. It looks like a credible result overall - although revenues of US$123m were in line with what the analysts predicted, NBT Bancorp surprised by delivering a statutory profit of US$0.90 per share, a notable 16% above expectations. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on NBT Bancorp after the latest results.

See our latest analysis for NBT Bancorp

Taking into account the latest results, NBT Bancorp's six analysts currently expect revenues in 2022 to be US$494.8m, approximately in line with the last 12 months. Statutory earnings per share are expected to decrease 9.2% to US$3.25 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$488.1m and earnings per share (EPS) of US$3.08 in 2022. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

There's been no major changes to the consensus price target of US$41.20, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic NBT Bancorp analyst has a price target of US$45.50 per share, while the most pessimistic values it at US$38.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting NBT Bancorp is an easy business to forecast or the the analysts are all using similar assumptions.

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 pretty clear that there is an expectation that NBT Bancorp's revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 1.1% growth on an annualised basis. This is compared to a historical growth rate of 5.8% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 7.7% per year. Factoring in the forecast slowdown in growth, it seems obvious that NBT Bancorp is also expected to grow slower than other industry participants.

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 NBT Bancorp following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that NBT Bancorp's revenues are expected to perform worse than the wider industry. The consensus price target held steady at US$41.20, with the latest estimates not enough to have an impact on their price targets.

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 NBT Bancorp analysts - going out to 2023, 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 NBT Bancorp 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.