Yahoo Finance Commerce Bancshares, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions
A week ago, Commerce Bancshares, Inc. (NASDAQ:CBSH) came out with a strong set of first-quarter numbers that could potentially lead to a re-rate of the stock. The company beat expectations with revenues of US$400m arriving 2.7% ahead of forecasts. Statutory earnings per share (EPS) were US$0.86, 7.2% ahead of estimates. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Check out our latest analysis for Commerce Bancshares
Taking into account the latest results, the current consensus from Commerce Bancshares' eight analysts is for revenues of US$1.61b in 2024. This would reflect a credible 3.0% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to increase 4.9% to US$3.77. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.58b and earnings per share (EPS) of US$3.27 in 2024. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the nice gain to earnings per share expectations following these results.
The consensus price target was unchanged at US$55.75, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Commerce Bancshares at US$61.00 per share, while the most bearish prices it at US$52.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Commerce Bancshares' past performance and to peers in the same industry. We would highlight that Commerce Bancshares' revenue growth is expected to slow, with the forecast 4.1% annualised growth rate until the end of 2024 being well below the historical 5.2% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 5.8% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Commerce Bancshares.
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 Commerce Bancshares following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
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. We have estimates - from multiple Commerce Bancshares analysts - going out to 2026, and you can see them free on our platform here.
It is also worth noting that we have found 2 warning signs for Commerce Bancshares (1 is potentially serious!) that you need to take into consideration.
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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.
