Analyst Estimates: Here's What Brokers Think Of Jefferies Financial Group Inc. (NYSE:JEF) After Its Second-Quarter Report
Investors in Jefferies Financial Group Inc. (NYSE:JEF) had a good week, as its shares rose 4.7% to close at US$53.44 following the release of its second-quarter results. It was a workmanlike result, with revenues of US$1.7b coming in 4.0% ahead of expectations, and statutory earnings per share of US$0.64, in line with analyst appraisals. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Jefferies Financial Group after the latest results.
View our latest analysis for Jefferies Financial Group
Taking into account the latest results, the current consensus from Jefferies Financial Group's three analysts is for revenues of US$6.85b in 2024. This would reflect a notable 19% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to jump 44% to US$2.94. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$6.85b and earnings per share (EPS) of US$2.94 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
There were no changes to revenue or earnings estimates or the price target of US$54.00, suggesting that the company has met expectations in its recent result. 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. There are some variant perceptions on Jefferies Financial Group, with the most bullish analyst valuing it at US$58.00 and the most bearish at US$44.00 per share. This is a very narrow spread of estimates, implying either that Jefferies Financial Group is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
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. One thing stands out from these estimates, which is that Jefferies Financial Group is forecast to grow faster in the future than it has in the past, with revenues expected to display 41% annualised growth until the end of 2024. If achieved, this would be a much better result than the 18% annual decline over the past three years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 5.6% annually. Not only are Jefferies Financial Group's revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at US$54.00, with the latest estimates not enough to have an impact on their price targets.
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 Jefferies Financial Group going out to 2026, and you can see them free on our platform here..
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Jefferies Financial Group , and understanding these should be part of your investment process.
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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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com