Yahoo Finance Earnings Beat: Fulton Financial Corporation Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models
Investors in Fulton Financial Corporation (NASDAQ:FULT) had a good week, as its shares rose 9.9% to close at US$11.32 following the release of its quarterly results. It looks like a credible result overall - although revenues of US$217m were what the analysts expected, Fulton Financial surprised by delivering a (statutory) profit of US$0.38 per share, an impressive 89% above what was forecast. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
See our latest analysis for Fulton Financial
Following the latest results, Fulton Financial's eight analysts are now forecasting revenues of US$850.6m in 2021. This would be a meaningful 12% improvement in sales compared to the last 12 months. Statutory earnings per share are forecast to dive 22% to US$0.83 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$840.4m and earnings per share (EPS) of US$0.77 in 2021. So the consensus seems to have become somewhat more optimistic on Fulton Financial's earnings potential following these results.
The consensus price target was unchanged at US$11.29, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Fulton Financial, with the most bullish analyst valuing it at US$13.00 and the most bearish at US$10.00 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's clear from the latest estimates that Fulton Financial's rate of growth is expected to accelerate meaningfully, with the forecast 12% revenue growth noticeably faster than its historical growth of 3.9%p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 1.5% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Fulton Financial 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 Fulton Financial following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. The consensus price target held steady at US$11.29, with the latest estimates not enough to have an impact on their price targets.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Fulton Financial analysts - going out to 2022, and you can see them free on our platform here.
Even so, be aware that Fulton Financial is showing 1 warning sign in our investment analysis , you should know about...
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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