EVERTEC, Inc. Just Recorded A 43% EPS Beat: Here's What Analysts Are Forecasting Next

The quarterly results for EVERTEC, Inc. (NYSE:EVTC) were released last week, making it a good time to revisit its performance. Revenues were US$212m, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$0.49, an impressive 43% 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for EVERTEC

Taking into account the latest results, the most recent consensus for EVERTEC from six analysts is for revenues of US$850.7m in 2024. If met, it would imply a notable 8.4% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to bounce 36% to US$1.47. Before this earnings report, the analysts had been forecasting revenues of US$850.6m and earnings per share (EPS) of US$1.33 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$39.40, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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. Currently, the most bullish analyst values EVERTEC at US$42.00 per share, while the most bearish prices it at US$33.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting EVERTEC is an easy business to forecast or the the analysts are all using similar assumptions.

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 analysts are definitely expecting EVERTEC's growth to accelerate, with the forecast 17% annualised growth to the end of 2024 ranking favourably alongside historical growth of 9.5% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 3.8% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that EVERTEC is expected to grow much faster than its industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around EVERTEC's earnings potential next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at US$39.40, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple EVERTEC 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 3 warning signs for EVERTEC (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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com