intu properties plc (LON:INTU): What Can We Expect From This High Growth Stock?

The most recent earnings update intu properties plc’s (LON:INTU) released in December 2017 revealed that the company benefited from a robust tailwind, eventuating to a double-digit earnings growth of 18.61%. Below is my commentary, albeit very simple and high-level, on how market analysts perceive intu properties’s earnings growth outlook over the next few years and whether the future looks even brighter than the past. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in. See our latest analysis for intu properties

Market analysts’ consensus outlook for next year seems pessimistic, with earnings turning into a loss in 2019. Though this loss doesn’t seem to last long as INTU turns profitable again by 2021 with earnings expected to be -UK£452.57m.

LSE:INTU Future Profit June 25th 18
LSE:INTU Future Profit June 25th 18

While it is helpful to understand the growth year by year relative to today’s value, it may be more valuable estimating the rate at which the earnings are rising or falling on average every year. The advantage of this approach is that we can get a better picture of the direction of intu properties’s earnings trajectory over the long run, irrespective of near term fluctuations, 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 46.20%. This means that, we can assume intu properties will grow its earnings by 46.20% every year for the next couple of years.

Next Steps:

For intu properties, there are three relevant factors you should further research:

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