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Earnings Beat: F.N.B. Corporation Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

Simply Wall St
·4-min read

Investors in F.N.B. Corporation (NYSE:FNB) had a good week, as its shares rose 3.2% to close at US$7.53 following the release of its third-quarter results. F.N.B reported US$307m in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$0.25 beat expectations, being 8.1% higher than what the analysts expected. 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for F.N.B


Taking into account the latest results, the current consensus from F.N.B's eight analysts is for revenues of US$1.22b in 2021, which would reflect a notable 8.3% increase on its sales over the past 12 months. Statutory earnings per share are expected to shrink 4.5% to US$0.88 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.22b and earnings per share (EPS) of US$0.88 in 2021. 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.

The analysts reconfirmed their price target of US$9.11, showing that the business is executing well and in line with expectations. 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. Currently, the most bullish analyst values F.N.B at US$10.00 per share, while the most bearish prices it at US$8.00. 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.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that F.N.B's revenue growth is expected to slow, with forecast 8.3% increase next year well below the historical 13%p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 1.4% next year. Even after the forecast slowdown in growth, it seems obvious that F.N.B is also expected to grow faster than the wider industry.

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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at US$9.11, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on F.N.B. Long-term earnings power is much more important than next year's profits. We have forecasts for F.N.B going out to 2022, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 1 warning sign for F.N.B that you need to be mindful 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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