Things Look Grim For New York Community Bancorp, Inc. (NYSE:NYCB) After Today's Downgrade

Today is shaping up negative for New York Community Bancorp, Inc. (NYSE:NYCB) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Both revenue and earnings per share (EPS) estimates were cut sharply as the analysts factored in the latest outlook for the business, concluding that they were too optimistic previously.

Following the downgrade, the latest consensus from New York Community Bancorp's 15 analysts is for revenues of US$3.3b in 2024, which would reflect a decent 19% improvement in sales compared to the last 12 months. Statutory earnings per share are supposed to nosedive 79% to US$0.68 in the same period. Before this latest update, the analysts had been forecasting revenues of US$3.6b and earnings per share (EPS) of US$0.80 in 2024. From this we can that analyst sentiment has definitely become more bearish after the latest update, leading to lower revenue forecasts and a considerable drop in earnings per share estimates.

See our latest analysis for New York Community Bancorp

It'll come as no surprise then, to learn that the analysts have cut their price target 40% to US$7.22.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 19% growth on an annualised basis. That is in line with its 19% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 5.8% per year. So although New York Community Bancorp is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for New York Community Bancorp. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of New York Community Bancorp.

There might be good reason for analyst bearishness towards New York Community Bancorp, like dilutive stock issuance over the past year. Learn more, and discover the 4 other concerns we've identified, for free 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.