What Are Analysts Saying About WSP Global Inc’s (TSE:WSP) Future?

In December 2017, WSP Global Inc (TSX:WSP) announced its most recent earnings update, which showed that the company experienced a slight tailwind, eventuating to a single-digit earnings growth of 7.13%. Investors may find it useful to understand how market analysts predict WSP Global’s earnings growth trajectory over the next few years and whether the future looks even brighter than the past. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings. View our latest analysis for WSP Global

Analysts’ expectations for this coming year seems optimistic, with earnings rising by a robust 47.50%. This growth seems to continue into the following year with rates arriving at double digit 69.73% compared to today’s earnings, and finally hitting CA$395.91M by 2021.

TSX:WSP Future Profit Apr 20th 18
TSX:WSP Future Profit Apr 20th 18

Even though it’s useful to be aware of the rate of growth year by year relative to today’s figure, it may be more insightful determining the rate at which the business is growing every year, on average. The advantage of this method is that it ignores near term flucuations and accounts for the overarching direction of WSP Global’s earnings trajectory over time, which may be more relevant for long term investors. To calculate this rate, I’ve appended a line of best fit through analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is 21.22%. This means that, we can expect WSP Global will grow its earnings by 21.22% every year for the next few years.

Next Steps:

For WSP Global, I’ve put together three pertinent factors you should look at:

  1. 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.
  2. Valuation: What is WSP 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 WSP is currently mispriced by the market.
  3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of WSP? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!