On 30 June 2019, Public Joint Stock Company Gazprom Neft (MCX:SIBN) announced its latest earnings update. Overall, it seems that analyst forecasts are fairly pessimistic, with earnings expected to decline by 2.8% in the upcoming year compared with the past 5-year average growth rate of 27%. Presently, with latest-twelve-month earnings at RUруб377b, we should see this fall to RUруб366b by 2020. In this article, I’ve outline a few earnings growth rates to give you a sense of the market sentiment for Gazprom Neft in the longer term. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.
How is Gazprom Neft going to perform in the near future?
Over the next three years, it seems the consensus view of the 10 analysts covering SIBN is skewed towards the positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. To understand the overall trajectory of SIBN’s earnings growth over these next fews years, I’ve fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope.
From the current net income level of RUруб377b and the final forecast of RUруб384b by 2022, the annual rate of growth for SIBN’s earnings is 1.5%. EPS reaches RUB89.44 in the final year of forecast compared to the current RUB79.84 EPS today. Analysts are predicting this high revenue growth to squeeze profit margins over time, from 16% to 15% by the end of 2022.
Future outlook is only one aspect when you’re building an investment case for a stock. For Gazprom Neft, I’ve put together three fundamental factors you should further research:
- Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
- Valuation: What is Gazprom Neft worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether Gazprom Neft is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Gazprom Neft? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.