South Plains Financial, Inc. (NASDAQ:SPFI) Just Reported And Analysts Have Been Lifting Their Price Targets

South Plains Financial, Inc. (NASDAQ:SPFI) shareholders are probably feeling a little disappointed, since its shares fell 4.9% to US$33.48 in the week after its latest quarterly results. Results look mixed - while revenue fell marginally short of analyst estimates at US$48m, statutory earnings were in line with expectations, at US$0.66 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for South Plains Financial

Taking into account the latest results, the consensus forecast from South Plains Financial's four analysts is for revenues of US$206.3m in 2025. This reflects a notable 14% improvement in revenue compared to the last 12 months. Per-share earnings are expected to accumulate 4.1% to US$2.77. In the lead-up to this report, the analysts had been modelling revenues of US$206.0m and earnings per share (EPS) of US$2.72 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

With the analysts reconfirming their revenue and earnings forecasts, it's surprising to see that the price target rose 6.9% to US$38.75. It looks as though they previously had some doubts over whether the business would live up to their expectations. 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 South Plains Financial analyst has a price target of US$41.00 per share, while the most pessimistic values it at US$37.00. This is a very narrow spread of estimates, implying either that South Plains Financial is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

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. The analysts are definitely expecting South Plains Financial's growth to accelerate, with the forecast 11% annualised growth to the end of 2025 ranking favourably alongside historical growth of 3.8% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 6.7% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect South Plains Financial 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 that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for South Plains Financial going out to 2026, and you can see them free on our platform here.

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with South Plains Financial , and understanding these should be part of your investment process.

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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.