Investors in National Bank Holdings Corporation (NYSE:NBHC) had a good week, as its shares rose 2.5% to close at US$33.65 following the release of its quarterly results. National Bank Holdings reported US$103m in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$0.82 beat expectations, being 7.3% higher than what the analysts expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on National Bank Holdings after the latest results.
Taking into account the latest results, the most recent consensus for National Bank Holdings from five analysts is for revenues of US$426.7m in 2024. If met, it would imply a reasonable 3.9% increase on its revenue over the past 12 months. Statutory earnings per share are forecast to drop 10% to US$3.15 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$431.6m and earnings per share (EPS) of US$3.25 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.
It might be a surprise to learn that the consensus price target was broadly unchanged at US$40.60, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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. Currently, the most bullish analyst values National Bank Holdings at US$45.00 per share, while the most bearish prices it at US$38.00. 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.
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 National Bank Holdings' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 5.2% growth on an annualised basis. This is compared to a historical growth rate of 7.7% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 6.0% annually. Factoring in the forecast slowdown in growth, it looks like National Bank Holdings is forecast to grow at about the same rate as the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for National Bank Holdings. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at US$40.60, with the latest estimates not enough to have an impact on their price targets.
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 National Bank Holdings analysts - going out to 2025, and you can see them free on our platform here.
You can also see our analysis of National Bank Holdings' Board and CEO remuneration and experience, and whether company insiders have been buying stock.
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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.