Ambac Financial Group, Inc. (NYSE:AMBC) shareholders will have a reason to smile today, with the covering analyst making substantial upgrades to this year's statutory forecasts. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects.
Following the upgrade, the current consensus from Ambac Financial Group's one analyst is for revenues of US$300m in 2021 which - if met - would reflect a major 28% increase on its sales over the past 12 months. Before the latest update, the analyst was foreseeing US$213m of revenue in 2021. It looks like there's been a clear increase in optimism around Ambac Financial Group, given the great increase in revenue forecasts.
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. One thing stands out from these estimates, which is that Ambac Financial Group is forecast to grow faster in the future than it has in the past, with revenues expected to display 39% annualised growth until the end of 2021. If achieved, this would be a much better result than the 19% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 3.0% per year. So it looks like Ambac Financial Group is expected to grow faster than its competitors, at least for a while.
The Bottom Line
The highlight for us was that the analyst increased their revenue forecasts for Ambac Financial Group this year. They're also forecasting more rapid revenue growth than the wider market. Given that the analyst appears to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Ambac Financial Group.
Of course, there's always more to the story. One Ambac Financial Group broker/analyst has provided estimates out to 2022, which can be seen for free on our platform here.
Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.
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