Yahoo Finance OFG Bancorp (NYSE:OFG) Just Reported And Analysts Have Been Lifting Their Price Targets
It's been a mediocre week for OFG Bancorp (NYSE:OFG) shareholders, with the stock dropping 11% to US$27.04 in the week since its latest yearly results. Revenues of US$540m were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at US$2.81, missing estimates by 2.9%. 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. 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 OFG Bancorp
Taking into account the latest results, the current consensus from OFG Bancorp's three analysts is for revenues of US$552.9m in 2022, which would reflect a credible 2.3% increase on its sales over the past 12 months. Statutory earnings per share are expected to shrink 4.8% to US$2.78 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$542.9m and earnings per share (EPS) of US$2.80 in 2022. 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 consensus price target rose 8.2% to US$35.33despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of OFG Bancorp's earnings by assigning a price premium. 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 OFG Bancorp, with the most bullish analyst valuing it at US$36.00 and the most bearish at US$35.00 per share. 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.
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 OFG Bancorp's revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 2.3% growth on an annualised basis. This is compared to a historical growth rate of 12% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 5.0% annually. Factoring in the forecast slowdown in growth, it seems obvious that OFG Bancorp 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. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for OFG Bancorp going out to 2023, and you can see them free on our platform here..
You still need to take note of risks, for example - OFG Bancorp has 2 warning signs (and 1 which is potentially serious) we think you should know about.
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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.
