Celebrations may be in order for Bank of Commerce Holdings (NASDAQ:BOCH) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects.
After the upgrade, the two analysts covering Bank of Commerce Holdings are now predicting revenues of US$67m in 2021. If met, this would reflect a huge 24% improvement in sales compared to the last 12 months. Per-share earnings are expected to ascend 19% to US$1.00. Previously, the analysts had been modelling revenues of US$58m and earnings per share (EPS) of US$0.79 in 2021. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.
Check out our latest analysis for Bank of Commerce Holdings
With these upgrades, we're not surprised to see that the analysts have lifted their price target 9.8% to US$11.25 per share. 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 Bank of Commerce Holdings at US$10.50 per share, while the most bearish prices it at US$10.00. With such a narrow range of valuations, analysts apparently share similar views on what they think the business is worth.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting Bank of Commerce Holdings' growth to accelerate, with the forecast 24% growth ranking favourably alongside historical growth of 9.1% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 6.0% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that Bank of Commerce Holdings is expected to grow much faster than its industry.
The Bottom Line
The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Bank of Commerce Holdings.