Results: Stock Yards Bancorp, Inc. Exceeded Expectations And The Consensus Has Updated Its Estimates
Stock Yards Bancorp, Inc. (NASDAQ:SYBT) last week reported its latest third-quarter results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. It looks like a credible result overall - although revenues of US$47m were in line with what the analysts predicted, Stock Yards Bancorp surprised by delivering a statutory profit of US$0.64 per share, a notable 15% above expectations. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Stock Yards Bancorp after the latest results.
View our latest analysis for Stock Yards Bancorp
After the latest results, the three analysts covering Stock Yards Bancorp are now predicting revenues of US$187.1m in 2021. If met, this would reflect a decent 13% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to reduce 8.7% to US$2.34 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$183.5m and earnings per share (EPS) of US$2.18 in 2021. So the consensus seems to have become somewhat more optimistic on Stock Yards Bancorp's earnings potential following these results.
The consensus price target rose 13% to US$42.75, suggesting that higher earnings estimates flow through to the stock's valuation as well. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Stock Yards Bancorp analyst has a price target of US$47.00 per share, while the most pessimistic values it at US$40.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting Stock Yards Bancorp's growth to accelerate, with the forecast 13% growth ranking favourably alongside historical growth of 7.0% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 1.3% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that Stock Yards Bancorp is expected to grow much faster than its 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 Stock Yards Bancorp following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
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. At Simply Wall St, we have a full range of analyst estimates for Stock Yards Bancorp going out to 2022, and you can see them free on our platform here..
Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Stock Yards Bancorp (1 is a bit concerning) you should be aware of.
This article by Simply Wall St is general in nature. 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.
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