Premier Financial Corp. Just Recorded A 5.9% EPS Beat: Here's What Analysts Are Forecasting Next

Investors in Premier Financial Corp. (NASDAQ:PFC) had a good week, as its shares rose 4.6% to close at US$20.08 following the release of its first-quarter results. The result was positive overall - although revenues of US$62m were in line with what the analysts predicted, Premier Financial surprised by delivering a statutory profit of US$0.50 per share, modestly greater than expected. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Premier Financial

Taking into account the latest results, the current consensus, from the five analysts covering Premier Financial, is for revenues of US$256.4m in 2024. This implies a definite 14% reduction in Premier Financial's revenue over the past 12 months. Statutory earnings per share are expected to dive 31% to US$2.13 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$261.9m and earnings per share (EPS) of US$2.14 in 2024. So it looks like the analysts have become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.

The average price target was steady at US$23.75even though revenue estimates declined; likely suggesting the analysts place a higher value on earnings. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Premier Financial, with the most bullish analyst valuing it at US$27.50 and the most bearish at US$22.00 per share. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 19% by the end of 2024. This indicates a significant reduction from annual growth of 15% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 6.0% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Premier Financial is expected to lag the wider industry.

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. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Even so, long term profitability is more important for the value creation process. The consensus price target held steady at US$23.75, 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 forecasts for Premier Financial going out to 2025, and you can see them free on our platform here.

You still need to take note of risks, for example - Premier Financial has 1 warning sign we think you should be aware of.

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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.