Skyward Specialty Insurance Group, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

Skyward Specialty Insurance Group, Inc. (NASDAQ:SKWD) investors will be delighted, with the company turning in some strong numbers with its latest results. The company beat both earnings and revenue forecasts, with revenue of US$190m, some 7.1% above estimates, and statutory earnings per share (EPS) coming in at US$0.42, 34% ahead of expectations. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Skyward Specialty Insurance Group

Taking into account the latest results, the current consensus from Skyward Specialty Insurance Group's five analysts is for revenues of US$807.4m in 2023, which would reflect a notable 19% increase on its sales over the past 12 months. Per-share earnings are expected to bounce 127% to US$1.59. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$758.0m and earnings per share (EPS) of US$1.62 in 2023. So it's pretty clear consensus is mixed on Skyward Specialty Insurance Group after the latest results; whilethe analysts lifted revenue numbers, they also administered a small dip in per-share earnings expectations.

The analysts also upgraded Skyward Specialty Insurance Group's price target 6.1% to US$26.00, implying that the higher sales are expected to generate enough value to offset the forecast decline in earnings. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Skyward Specialty Insurance Group, with the most bullish analyst valuing it at US$27.00 and the most bearish at US$25.00 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Skyward Specialty Insurance Group's past performance and to peers in the same industry. The analysts are definitely expecting Skyward Specialty Insurance Group's growth to accelerate, with the forecast 26% annualised growth to the end of 2023 ranking favourably alongside historical growth of 20% per annum over the past year. Compare this with other companies in the same industry, which are forecast to grow their revenue 6.0% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Skyward Specialty Insurance Group is expected to grow much faster than its industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Skyward Specialty Insurance Group. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that in mind, we wouldn't be too quick to come to a conclusion on Skyward Specialty Insurance Group. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Skyward Specialty Insurance Group analysts - going out to 2024, and you can see them free on our platform here.

We also provide an overview of the Skyward Specialty Insurance Group 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.