The TowneBank (NASDAQ:TOWN) First-Quarter Results Are Out And Analysts Have Published New Forecasts

It's been a good week for TowneBank (NASDAQ:TOWN) shareholders, because the company has just released its latest quarterly results, and the shares gained 3.7% to US$27.15. It looks like the results were a bit of a negative overall. While revenues of US$167m were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 3.8% to hit US$0.46 per share. 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for TowneBank

Taking into account the latest results, the consensus forecast from TowneBank's five analysts is for revenues of US$705.8m in 2024. This reflects a modest 5.2% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to increase 4.8% to US$2.13. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$705.0m and earnings per share (EPS) of US$2.11 in 2024. 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.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$31.20. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on TowneBank, with the most bullish analyst valuing it at US$32.00 and the most bearish at US$30.00 per share. This is a very narrow spread of estimates, implying either that TowneBank is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the TowneBank's past performance and to peers in the same industry. The analysts are definitely expecting TowneBank's growth to accelerate, with the forecast 7.0% annualised growth to the end of 2024 ranking favourably alongside historical growth of 5.6% per annum over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 6.0% per year. TowneBank is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

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. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

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 estimates - from multiple TowneBank analysts - going out to 2025, and you can see them free on our platform here.

It might also be worth considering whether TowneBank's debt load is appropriate, using our debt analysis tools on the Simply Wall St 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.