Enact Holdings, Inc. (NASDAQ:ACT) Just Reported Annual Earnings: Have Analysts Changed Their Mind On The Stock?

Shareholders might have noticed that Enact Holdings, Inc. (NASDAQ:ACT) filed its yearly result this time last week. The early response was not positive, with shares down 5.8% to US$26.79 in the past week. It was a credible result overall, with revenues of US$1.2b and statutory earnings per share of US$4.11 both in line with analyst estimates, showing that Enact Holdings is executing in line with expectations. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for Enact Holdings

Following the latest results, Enact Holdings' four analysts are now forecasting revenues of US$1.19b in 2024. This would be a satisfactory 3.6% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to dip 9.6% to US$3.77 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$1.22b and earnings per share (EPS) of US$3.69 in 2024. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The consensus price target was unchanged at US$31.86, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 Enact Holdings, with the most bullish analyst valuing it at US$35.00 and the most bearish at US$29.00 per share. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Enact Holdings 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 can infer from the latest estimates that forecasts expect a continuation of Enact Holdings'historical trends, as the 3.6% annualised revenue growth to the end of 2024 is roughly in line with the 3.6% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 3.8% annually. It's clear that while Enact Holdings' revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Enact Holdings following these results. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider 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.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Enact Holdings analysts - going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for Enact Holdings (1 doesn't sit too well with us!) that you need to be mindful 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.