EVERTEC, Inc. (NYSE:EVTC) Just Released Its Third-Quarter Results And Analysts Are Updating Their Estimates

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Investors in EVERTEC, Inc. (NYSE:EVTC) had a good week, as its shares rose 8.1% to close at US$35.33 following the release of its quarterly results. It was a credible result overall, with revenues of US$212m and statutory earnings per share of US$0.38 both in line with analyst estimates, showing that EVERTEC 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for EVERTEC

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NYSE:EVTC Earnings and Revenue Growth November 9th 2024

Taking into account the latest results, the consensus forecast from EVERTEC's six analysts is for revenues of US$903.8m in 2025. This reflects a decent 9.7% improvement in revenue compared to the last 12 months. Per-share earnings are expected to surge 37% to US$1.81. Before this earnings report, the analysts had been forecasting revenues of US$909.4m and earnings per share (EPS) of US$1.74 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

There's been no major changes to the consensus price target of US$35.60, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. 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. The most optimistic EVERTEC analyst has a price target of US$42.00 per share, while the most pessimistic values it at US$28.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

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. It's pretty clear that there is an expectation that EVERTEC's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 7.7% growth on an annualised basis. This is compared to a historical growth rate of 10% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 4.0% per year. Even after the forecast slowdown in growth, it seems obvious that EVERTEC is also expected to grow faster than the wider industry.