Yahoo Finance QBE Insurance Group Limited (ASX:QBE) Just Released Its Yearly Results And Analysts Are Updating Their Estimates
Last week, you might have seen that QBE Insurance Group Limited (ASX:QBE) released its annual result to the market. The early response was not positive, with shares down 8.5% to AU$11.55 in the past week. It was an okay result overall, with revenues coming in at US$14b, roughly what the analysts had been expecting. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
View our latest analysis for QBE Insurance Group
Taking into account the latest results, the most recent consensus for QBE Insurance Group from ten analysts is for revenues of US$15.1b in 2022 which, if met, would be a meaningful 12% increase on its sales over the past 12 months. Per-share earnings are expected to increase 9.9% to US$0.56. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$14.2b and earnings per share (EPS) of US$0.69 in 2022. While next year's revenue estimates increased, there was also a real cut to EPS expectations, suggesting the consensus has a bit of a mixed view of these results.
There's been no major changes to the price target of AU$14.36, suggesting that the impact of higher forecast sales and lower earnings won't result in a meaningful change to the business' valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on QBE Insurance Group, with the most bullish analyst valuing it at AU$16.10 and the most bearish at AU$11.00 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting QBE Insurance Group's growth to accelerate, with the forecast 12% annualised growth to the end of 2022 ranking favourably alongside historical growth of 2.1% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 2.8% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect QBE Insurance Group to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than the wider industry. The consensus price target held steady at AU$14.36, 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. At Simply Wall St, we have a full range of analyst estimates for QBE Insurance Group going out to 2024, and you can see them free on our platform here..
You can also view our analysis of QBE Insurance Group's balance sheet, and whether we think QBE Insurance Group is carrying too much debt, for free on our platform here.
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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.
