Kemper Corporation Just Beat Revenue Estimates By 6.7%

It's been a good week for Kemper Corporation (NYSE:KMPR) shareholders, because the company has just released its latest first-quarter results, and the shares gained 2.7% to US$58.98. It was a workmanlike result, with revenues of US$1.1b coming in 6.7% ahead of expectations, and statutory earnings per share of US$1.10, in line with analyst appraisals. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Kemper

Taking into account the latest results, the current consensus, from the five analysts covering Kemper, is for revenues of US$4.24b in 2024. This implies a considerable 12% reduction in Kemper's revenue over the past 12 months. Kemper is also expected to turn profitable, with statutory earnings of US$4.27 per share. In the lead-up to this report, the analysts had been modelling revenues of US$4.22b and earnings per share (EPS) of US$4.56 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

The consensus price target held steady at US$72.20, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Kemper at US$77.00 per share, while the most bearish prices it at US$67.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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. We would highlight that revenue is expected to reverse, with a forecast 15% annualised decline to the end of 2024. That is a notable change from historical growth of 2.4% 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 6.0% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Kemper is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Kemper's revenue is expected to perform worse than the wider industry. The consensus price target held steady at US$72.20, 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 forecasts for Kemper going out to 2026, and you can see them free on our platform here.

Even so, be aware that Kemper 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.