U.K. (FTSE) IT Industry Analysis

Industry Valuation and Performance

Has the U.K. IT Industry valuation changed over the past few years?

Current Industry PE: Investors are more optimistic on the industry, considering it's trading at a PE ratio of 42.6x which is higher than its 3-year average PE of 34.0x. It appears they are confident that earnings will grow faster in the future than they have historically.

Past Earnings Growth: The earnings for companies in the IT industry have grown 49% per year over the last three years, and revenues for these companies have grown 28% per year. This means that more sales are being generated by these companies overall, and subsequently their profits are increasing too.

Industry Trends

Which industries have driven the changes within the U.K. IT industry?

Industry PE: Investors are most optimistic about the IT Consulting industry which is trading above its 3-year average PE ratio of 36.2x. However analysts are expecting annual earnings growth of 12%, which is lower than the prior year's growth of 35% per year. So the market might believe that analysts are underestimating future growth. Meanwhile, investors are most pessimistic about the Internet Services and Infrastructure industry, which is trading below its 3-year average of 39.4x.

Forecasted Growth: Analysts are most optimistic on the Internet Services and Infrastructure industry, expecting annual earnings growth of 50% over the next 5 years. This is better than its past earnings decline of 22% per year. Meanwhile, the IT Consulting industry is expected to see its earnings grow by 12% per year over the next few years.

Top Stock Gainers and Losers

Which companies have driven the market over the last 7 days?