Yahoo Finance Revenue Beat: Camden National Corporation Beat Analyst Estimates By 16%
Last week, you might have seen that Camden National Corporation (NASDAQ:CAC) released its second-quarter result to the market. The early response was not positive, with shares down 5.1% to US$32.53 in the past week. It was a mildly positive result, with revenues exceeding expectations at US$47m, while statutory earnings per share (EPS) of US$0.73 were in line with analyst forecasts. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
See our latest analysis for Camden National
Following last week's earnings report, Camden National's three analysts are forecasting 2020 revenues to be US$166.9m, approximately in line with the last 12 months. Statutory earnings per share are expected to decrease 9.0% to US$3.25 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$161.9m and earnings per share (EPS) of US$3.21 in 2020. So it looks like there's been no major change in sentiment following the latest results, although the analysts have made a modest lift to to revenue forecasts.
Even though revenue forecasts increased, there was no change to the consensus price target of US$36.00, suggesting the analysts are focused on earnings as the driver of value creation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Camden National analyst has a price target of US$38.00 per share, while the most pessimistic values it at US$34.00. 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. It's pretty clear that there is an expectation that Camden National's revenue growth will slow down substantially, with revenues next year expected to grow 1.4%, compared to a historical growth rate of 8.2% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 1.9% per year. Factoring in the forecast slowdown in growth, it seems obvious that Camden National is also expected to grow slower than other industry participants.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, they also upgraded their revenue estimates, although our data indicates sales are expected to perform worse than the wider industry. The consensus price target held steady at US$36.00, 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 forecasts for Camden National 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 1 warning sign for Camden National that 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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