United Bankshares, Inc. Just Recorded A 10% EPS Beat: Here's What Analysts Are Forecasting Next

It's been a good week for United Bankshares, Inc. (NASDAQ:UBSI) shareholders, because the company has just released its latest quarterly results, and the shares gained 6.5% to US$39.32. It looks like a credible result overall - although revenues of US$256m were in line with what the analysts predicted, United Bankshares surprised by delivering a statutory profit of US$0.71 per share, a notable 10% above expectations. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for United Bankshares

Following the latest results, United Bankshares' four analysts are now forecasting revenues of US$1.03b in 2024. This would be a credible 2.1% improvement in revenue compared to the last 12 months. Statutory per share are forecast to be US$2.68, approximately in line with the last 12 months. Before this earnings report, the analysts had been forecasting revenues of US$1.03b and earnings per share (EPS) of US$2.60 in 2024. So the consensus seems to have become somewhat more optimistic on United Bankshares' earnings potential following these results.

The consensus price target rose 7.0% to US$40.00, suggesting that higher earnings estimates flow through to the stock's valuation as well. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic United Bankshares analyst has a price target of US$44.00 per share, while the most pessimistic values it at US$36.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting United Bankshares is an easy business to forecast or the the analysts are all using similar assumptions.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that United Bankshares' revenue growth is expected to slow, with the forecast 4.3% annualised growth rate until the end of 2024 being well below the historical 7.6% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.4% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than United Bankshares.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around United Bankshares' earnings potential next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse 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 United Bankshares going out to 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.

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