It's been a good week for Enact Holdings, Inc. (NASDAQ:ACT) shareholders, because the company has just released its latest quarterly results, and the shares gained 5.9% to US$31.48. The result was positive overall - although revenues of US$292m were in line with what the analysts predicted, Enact Holdings surprised by delivering a statutory profit of US$1.01 per share, modestly greater than expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Enact Holdings after the latest results.

After the latest results, the three analysts covering Enact Holdings are now predicting revenues of US$1.21b in 2024. If met, this would reflect a modest 3.7% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to reduce 5.5% to US$3.91 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$1.19b and earnings per share (EPS) of US$3.83 in 2024. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The consensus price target was unchanged at US$34.00, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 Enact Holdings at US$37.00 per share, while the most bearish prices it at US$31.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Enact Holdings' past performance and to peers in the same industry. It's clear from the latest estimates that Enact Holdings' rate of growth is expected to accelerate meaningfully, with the forecast 4.9% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 0.6% p.a. over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 3.5% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Enact Holdings to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Enact Holdings following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Enact Holdings. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Enact Holdings analysts - going out to 2026, and you can see them free on our platform here.

Before you take the next step you should know about the 2 warning signs for Enact Holdings (1 is concerning!) that we have uncovered.

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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.