It's been a good week for Bridgewater Bancshares, Inc. (NASDAQ:BWB) shareholders, because the company has just released its latest annual results, and the shares gained 4.3% to US$17.99. It was a credible result overall, with revenues of US$110m and statutory earnings per share of US$1.54 both in line with analyst estimates, showing that Bridgewater Bancshares 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.
Taking into account the latest results, the current consensus from Bridgewater Bancshares' three analysts is for revenues of US$123.3m in 2022, which would reflect a decent 12% increase on its sales over the past 12 months. Per-share earnings are expected to rise 3.3% to US$1.63. In the lead-up to this report, the analysts had been modelling revenues of US$123.9m and earnings per share (EPS) of US$1.58 in 2022. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
The consensus price target was unchanged at US$21.33, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 Bridgewater Bancshares analyst has a price target of US$22.00 per share, while the most pessimistic values it at US$20.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Bridgewater Bancshares' revenue growth is expected to slow, with the forecast 12% annualised growth rate until the end of 2022 being well below the historical 17% p.a. growth over the last five years. Compare this with other companies in the same industry, which are forecast to see a revenue decline of 1.5% annually. So it's clear that despite the slowdown in growth, Bridgewater Bancshares is still expected to grow meaningfully faster than the wider industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Bridgewater Bancshares' earnings potential next year. Fortunately, they also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations. Their estimates also suggest that Bridgewater Bancshares' revenues are expected to perform better than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that in mind, we wouldn't be too quick to come to a conclusion on Bridgewater Bancshares. Long-term earnings power is much more important than next year's profits. We have forecasts for Bridgewater Bancshares going out to 2023, and you can see them free on our platform here.
You can also see our analysis of Bridgewater Bancshares' Board and CEO remuneration and experience, and whether company insiders have been buying stock.
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