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The annual results for TowneBank (NASDAQ:TOWN) were released last week, making it a good time to revisit its performance. The result was positive overall - although revenues of US$694m were in line with what the analysts predicted, TowneBank surprised by delivering a statutory profit of US$2.15 per share, modestly greater than expected. 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 collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
View our latest analysis for TowneBank
Following the latest results, TowneBank's four analysts are now forecasting revenues of US$788.1m in 2025. This would be a decent 14% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to grow 15% to US$2.50. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$784.9m and earnings per share (EPS) of US$2.53 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
The consensus price target rose 5.3% to US$40.00despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of TowneBank's earnings by assigning a price premium. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic TowneBank analyst has a price target of US$45.00 per share, while the most pessimistic values it at US$36.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.
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 clear from the latest estimates that TowneBank's rate of growth is expected to accelerate meaningfully, with the forecast 14% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 3.8% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 7.3% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that TowneBank is expected to grow much faster than its industry.