The most recent earnings release Liechtensteinische Landesbank Aktiengesellschaft’s (VTX:LLBN) announced in December 2018 signalled that the business faced a immense headwind with earnings declining by -26%. Today I want to provide a brief commentary on how market analysts view Liechtensteinische Landesbank’s earnings growth trajectory over the next couple of years and whether the future looks brighter. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in.
Market analysts’ consensus outlook for the upcoming year seems buoyant, with earnings rising by a robust 46%. This growth seems to continue into the following year with rates arriving at double digit 61% compared to today’s earnings, and finally hitting CHF135m by 2022.
While it is useful to be aware of the rate of growth year by year relative to today’s value, it may be more valuable to analyze the rate at which the company is rising or falling on average every year. The benefit of this technique is that it ignores near term flucuations and accounts for the overarching direction of Liechtensteinische Landesbank’s earnings trajectory over time, which may be more relevant for long term investors. To calculate this rate, I’ve inserted 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 16%. This means, we can anticipate Liechtensteinische Landesbank will grow its earnings by 16% every year for the next few years.
For Liechtensteinische Landesbank, I’ve compiled three fundamental aspects you should look at:
- 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 LLBN 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 LLBN is currently mispriced by the market.
- Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of LLBN? 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.