A week ago, Pacific Premier Bancorp, Inc. (NASDAQ:PPBI) came out with a strong set of quarterly numbers that could potentially lead to a re-rate of the stock. It was overall a positive result, with revenues beating expectations by 3.4% to hit US$193m. Pacific Premier Bancorp also reported a statutory profit of US$0.70, which was an impressive 26% above what the analysts had forecast. 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 Pacific Premier Bancorp after the latest results.
Taking into account the latest results, the current consensus from Pacific Premier Bancorp's five analysts is for revenues of US$706.0m in 2021, which would reflect a sizeable 83% increase on its sales over the past 12 months. Statutory earnings per share are predicted to surge 340% to US$2.04. In the lead-up to this report, the analysts had been modelling revenues of US$714.4m and earnings per share (EPS) of US$2.01 in 2021. 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.
The consensus price target rose 11% to US$29.00despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Pacific Premier Bancorp's earnings by assigning a price premium. 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 Pacific Premier Bancorp analyst has a price target of US$30.00 per share, while the most pessimistic values it at US$26.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
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 clear from the latest estimates that Pacific Premier Bancorp's rate of growth is expected to accelerate meaningfully, with the forecast 83% revenue growth noticeably faster than its historical growth of 27%p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 1.3% next year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Pacific Premier Bancorp to grow faster than the wider 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. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Pacific Premier Bancorp going out to 2022, and you can see them free on our platform here..
Even so, be aware that Pacific Premier Bancorp is showing 5 warning signs in our investment analysis , and 1 of those makes us a bit uncomfortable...
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