Earnings Miss: Fidelity National Financial, Inc. Missed EPS By 11% And Analysts Are Revising Their Forecasts

Fidelity National Financial, Inc. (NYSE:FNF) last week reported its latest second-quarter results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Revenues were in line with forecasts, at US$3.2b, although statutory earnings per share came in 11% below what the analysts expected, at US$1.12 per share. 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 thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Fidelity National Financial

Following last week's earnings report, Fidelity National Financial's three analysts are forecasting 2024 revenues to be US$12.9b, approximately in line with the last 12 months. Per-share earnings are expected to jump 34% to US$4.45. In the lead-up to this report, the analysts had been modelling revenues of US$12.9b and earnings per share (EPS) of US$4.63 in 2024. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

It might be a surprise to learn that the consensus price target was broadly unchanged at US$60.33, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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. Currently, the most bullish analyst values Fidelity National Financial at US$64.00 per share, while the most bearish prices it at US$56.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Fidelity National Financial's revenue growth is expected to slow, with the forecast 3.1% annualised growth rate until the end of 2024 being well below the historical 7.7% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.2% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Fidelity National Financial.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Fidelity National Financial. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$60.33, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Fidelity National Financial going out to 2026, and you can see them free on our platform here..

Even so, be aware that Fidelity National Financial is showing 1 warning sign in our investment analysis , you should know about...

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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.