Truist Financial Corporation (NYSE:TFC) Full-Year Results Just Came Out: Here's What Analysts Are Forecasting For This Year

Last week, you might have seen that Truist Financial Corporation (NYSE:TFC) released its yearly result to the market. The early response was not positive, with shares down 5.5% to US$63.12 in the past week. It was a workmanlike result, with revenues of US$23b coming in 3.2% ahead of expectations, and statutory earnings per share of US$4.47, in line with analyst appraisals. 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 Truist Financial

Taking into account the latest results, Truist Financial's 16 analysts currently expect revenues in 2022 to be US$23.0b, approximately in line with the last 12 months. Statutory per-share earnings are expected to be US$4.47, roughly flat on the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$22.7b and earnings per share (EPS) of US$4.58 in 2022. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

It might be a surprise to learn that the consensus price target was broadly unchanged at US$69.81, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Truist Financial analyst has a price target of US$77.00 per share, while the most pessimistic values it at US$57.00. This is a very narrow spread of estimates, implying either that Truist Financial is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that sales are expected to reverse, with a forecast 0.4% annualised revenue decline to the end of 2022. That is a notable change from historical growth of 19% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.0% per year. It's pretty clear that Truist Financial's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that Truist Financial's revenues are expected to perform worse than the wider industry. The consensus price target held steady at US$69.81, with the latest estimates not enough to have an impact on their price targets.

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 estimates - from multiple Truist Financial analysts - going out to 2024, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for Truist Financial that you should be aware of.

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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.