Yahoo Finance Sandy Spring Bancorp, Inc. (NASDAQ:SASR) Just Reported First-Quarter Earnings: Have Analysts Changed Their Mind On The Stock?
Investors in Sandy Spring Bancorp, Inc. (NASDAQ:SASR) had a good week, as its shares rose 7.1% to close at US$21.37 following the release of its quarterly results. It was a credible result overall, with revenues of US$98m and statutory earnings per share of US$0.45 both in line with analyst estimates, showing that Sandy Spring Bancorp is executing in line with expectations. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
See our latest analysis for Sandy Spring Bancorp
Taking into account the latest results, Sandy Spring Bancorp's five analysts currently expect revenues in 2024 to be US$406.6m, approximately in line with the last 12 months. Statutory earnings per share are expected to decrease 9.5% to US$1.85 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$416.4m and earnings per share (EPS) of US$2.06 in 2024. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a substantial drop in earnings per share estimates.
Despite the cuts to forecast earnings, there was no real change to the US$25.20 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Sandy Spring Bancorp at US$27.00 per share, while the most bearish prices it at US$24.00. This is a very narrow spread of estimates, implying either that Sandy Spring Bancorp is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
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. We would highlight that Sandy Spring Bancorp's revenue growth is expected to slow, with the forecast 2.3% annualised growth rate until the end of 2024 being well below the historical 8.4% 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 6.0% annually. Factoring in the forecast slowdown in growth, it seems obvious that Sandy Spring Bancorp is also expected to grow slower than other industry participants.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Sandy Spring Bancorp. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$25.20, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Sandy Spring Bancorp analysts - going out to 2025, and you can see them free on our platform here.
However, before you get too enthused, we've discovered 1 warning sign for Sandy Spring Bancorp that you should be aware of.
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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.