The Bank of Princeton (NASDAQ:BPRN) shares fell 2.9% to US$30.50 in the week since its latest full-year results. Results look mixed – while revenue fell marginally short of analyst estimates at US$40m, statutory earnings were in line with expectations, at US$1.47 per share. Earnings are an important time for investors, as they can track a company’s performance, look at what top analysts are forecasting for next year, and see if there’s been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
View our latest analysis for Bank of Princeton
NasdaqGS:BPRN Past and Future Earnings, February 1st 2020
Taking into account the latest results, the latest consensus from Bank of Princeton’s three analysts is for revenues of US$45.4m in 2020, which would reflect a meaningful 13% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to surge 33% to US$2.00. Before this earnings report, analysts had been forecasting revenues of US$46.3m and earnings per share (EPS) of US$2.05 in 2020. 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 forecasts for next year.
It might be a surprise to learn that the consensus price target fell 7.2% to US$32.00, with analysts clearly linking lower forecast earnings to the performance of the stock price. That’s not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Bank of Princeton analyst has a price target of US$33.00 per share, while the most pessimistic values it at US$31.00. Still, with such a tight range of estimates, it suggests analysts have a pretty good idea of what they think the company is worth.
It can also be useful to step back and take a broader view of how analyst forecasts compare to Bank of Princeton’s performance in recent years. It’s clear from the latest estimates that Bank of Princeton’s rate of growth is expected to accelerate meaningfully, with forecast 13% revenue growth noticeably faster than its historical growth of 2.6%p.a. over the past five years. Compare this with other companies in the same market, which are forecast to grow their revenue 5.0% next year. Factoring in the forecast acceleration in revenue, it’s pretty clear that Bank of Princeton is expected to grow much faster than its market.
The Bottom Line
The biggest concern with the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Bank of Princeton. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations – and our data does suggest that Bank of Princeton’s revenues are expected to grow faster than the wider market. The consensus price target fell measurably, with analysts seemingly not reassured by the latest results, leading to a lower estimate of Bank of Princeton’s future valuation.
Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have estimates – from multiple Bank of Princeton analysts – going out to 2021, and you can see them free on our platform here.
You can also see our analysis of Bank of Princeton’s Board and CEO remuneration and experience, and whether company insiders have been buying stock.
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