After Alm. Brand A/S’s (CPH:ALMB) earnings announcement on 31 December 2018, analyst forecasts seem fairly subdued, as a 11% rise in profits is expected in the upcoming year, against the higher past 5-year average growth rate of 22%. Currently with trailing-twelve-month earnings of ø569m, we can expect this to reach ø632m by 2020. Below is a brief commentary around Alm. Brand’s earnings outlook going forward, which may give you a sense of market sentiment for the company. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
How will Alm. Brand perform in the near future?
The view from 2 analysts over the next three years is one of positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. To get an idea of the overall earnings growth trend for ALMB, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.
From the current net income level of ø569m and the final forecast of ø698m by 2022, the annual rate of growth for ALMB’s earnings is 6.5%. This leads to an EPS of DKK4.72 in the final year of projections relative to the current EPS of DKK3.6. With a current profit margin of 7.1%, this movement will result in a margin of 12% by 2022.
Future outlook is only one aspect when you’re building an investment case for a stock. For Alm. Brand, there are three key 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 Alm. Brand 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 Alm. Brand is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Alm. Brand? 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 email@example.com. 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.