Need To Know: Analysts Are Much More Bullish On The Bancorp, Inc. (NASDAQ:TBBK) Revenues

The Bancorp, Inc. (NASDAQ:TBBK) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The revenue forecast for this year has experienced a facelift, with analysts now much more optimistic on its sales pipeline. The market may be pricing in some blue sky too, with the share price gaining 14% to US$32.71 in the last 7 days. Could this upgrade be enough to drive the stock even higher?

After the upgrade, the three analysts covering Bancorp are now predicting revenues of US$372m in 2023. If met, this would reflect a satisfactory 7.1% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to jump 43% to US$3.33. Previously, the analysts had been modelling revenues of US$319m and earnings per share (EPS) of US$3.22 in 2023. The forecasts seem more optimistic now, with a solid increase in revenue and a slight bump in earnings per share estimates.

Check out our latest analysis for Bancorp

It will come as no surprise to learn that the analysts have increased their price target for Bancorp 15% to US$40.33 on the back of these upgrades. 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 Bancorp, with the most bullish analyst valuing it at US$43.00 and the most bearish at US$38.00 per share. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or that the analysts have a clear view on its prospects.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We can infer from the latest estimates that forecasts expect a continuation of Bancorp'shistorical trends, as the 7.1% annualised revenue growth to the end of 2023 is roughly in line with the 8.6% annual revenue growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 6.5% per year. So although Bancorp is expected to maintain its revenue growth rate, it's only growing at about the rate of the wider industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. They also upgraded their revenue forecasts, although the latest estimates suggest that Bancorp will grow in line with the overall market. There was also a nice increase in the price target, with analysts apparently feeling that the intrinsic value of the business is improving. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Bancorp.

Better yet, our automated discounted cash flow calculation (DCF) suggests Bancorp could be moderately undervalued. You can learn more about our valuation methodology on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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.