Results: Evercore Inc. Exceeded Expectations And The Consensus Has Updated Its Estimates

A week ago, Evercore Inc. (NYSE:EVR) came out with a strong set of annual numbers that could potentially lead to a re-rate of the stock. The company beat expectations with revenues of US$2.8b arriving 5.5% ahead of forecasts. Statutory earnings per share (EPS) were US$11.61, 8.1% ahead of estimates. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Evercore

Following the recent earnings report, the consensus from seven analysts covering Evercore is for revenues of US$2.70b in 2023, implying a perceptible 2.3% decline in sales compared to the last 12 months. Statutory earnings per share are forecast to fall 14% to US$10.58 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$2.60b and earnings per share (EPS) of US$10.46 in 2023. There doesn't appear to have been a major change in sentiment following the results, other than the modest lift to revenue estimates.

It may not be a surprise to see thatthe analysts have reconfirmed their price target of US$130, implying that the uplift in sales is not expected to greatly contribute to Evercore's valuation in the near term. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Evercore analyst has a price target of US$158 per share, while the most pessimistic values it at US$94.00. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 2.3% by the end of 2023. This indicates a significant reduction from annual growth of 14% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 8.4% annually for the foreseeable future. It's pretty clear that Evercore's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, they also upgraded their revenue estimates, although our data indicates sales are expected to perform worse than the wider industry. The consensus price target held steady at US$130, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Evercore. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Evercore analysts - going out to 2025, and you can see them free on our platform here.

We also provide an overview of the Evercore Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, 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.