Yahoo Finance Northwest Bancshares, Inc. (NASDAQ:NWBI) Just Reported Earnings, And Analysts Cut Their Target Price
Last week saw the newest quarterly earnings release from Northwest Bancshares, Inc. (NASDAQ:NWBI), an important milestone in the company's journey to build a stronger business. Results were roughly in line with estimates, with revenues of US$131m and statutory earnings per share of US$0.23. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Check out our latest analysis for Northwest Bancshares
Following last week's earnings report, Northwest Bancshares' five analysts are forecasting 2024 revenues to be US$529.8m, approximately in line with the last 12 months. Statutory earnings per share are expected to plummet 31% to US$0.70 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$542.6m and earnings per share (EPS) of US$0.93 in 2024. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.
It'll come as no surprise then, to learn that the analysts have cut their price target 7.3% to US$11.40. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Northwest Bancshares analyst has a price target of US$12.00 per share, while the most pessimistic values it at US$10.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Northwest Bancshares is an easy business to forecast or the the analysts are all using similar assumptions.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Northwest Bancshares' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 1.7% growth on an annualised basis. This is compared to a historical growth rate of 5.7% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 6.0% per year. Factoring in the forecast slowdown in growth, it seems obvious that Northwest Bancshares is also expected to grow slower than other industry participants.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Northwest Bancshares. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Northwest Bancshares analysts - going out to 2025, and you can see them free on our platform here.
You still need to take note of risks, for example - Northwest Bancshares has 2 warning signs (and 1 which is concerning) we think 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.
