Peoples Financial Services Corp. Just Missed EPS By 18%: Here's What Analysts Think Will Happen Next

The analysts might have been a bit too bullish on Peoples Financial Services Corp. (NASDAQ:PFIS), given that the company fell short of expectations when it released its quarterly results last week. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at US$23m, statutory earnings missed forecasts by 18%, coming in at just US$0.49 per share. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Peoples Financial Services

Taking into account the latest results, the consensus forecast from Peoples Financial Services' dual analysts is for revenues of US$123.1m in 2024. This reflects a major 27% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to crater 75% to US$0.83 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$140.4m and earnings per share (EPS) of US$1.58 in 2024. It looks like sentiment has declined substantially in the aftermath of these results, with a substantial drop in revenue estimates and a pretty serious reduction to earnings per share numbers as well.

The consensus price target fell 8.2% to US$45.00, with the weaker earnings outlook clearly leading valuation estimates.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that Peoples Financial Services' rate of growth is expected to accelerate meaningfully, with the forecast 38% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 6.1% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 6.0% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Peoples Financial Services to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Peoples Financial Services. They also downgraded Peoples Financial Services' revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Peoples Financial Services' future valuation.

With that in mind, we wouldn't be too quick to come to a conclusion on Peoples Financial Services. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Peoples Financial Services going out as far as 2025, and you can see them free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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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.