Analysts Expect Land Securities Group plc (LON:LAND) To Breakeven Soon

By
Simply Wall St
Published
February 18, 2022
LSE:LAND
Source: Shutterstock

With the business potentially at an important milestone, we thought we'd take a closer look at Land Securities Group plc's (LON:LAND) future prospects. At Landsec, we build and invest in buildings, spaces and partnerships to create sustainable places, connect communities and realise potential. The UK£5.9b market-cap company’s loss lessened since it announced a UK£1.4b loss in the full financial year, compared to the latest trailing-twelve-month loss of UK£283m, as it approaches breakeven. The most pressing concern for investors is Land Securities Group's path to profitability – when will it breakeven? In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

Check out our latest analysis for Land Securities Group

According to the 9 industry analysts covering Land Securities Group, the consensus is that breakeven is near. They expect the company to post a final loss in 2021, before turning a profit of UK£624m in 2022. So, the company is predicted to breakeven approximately 12 months from now or less. How fast will the company have to grow to reach the consensus forecasts that anticipate breakeven by 2022? Working backwards from analyst estimates, it turns out that they expect the company to grow 12% year-on-year, on average, which is relatively reasonable. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
LSE:LAND Earnings Per Share Growth February 18th 2022

We're not going to go through company-specific developments for Land Securities Group given that this is a high-level summary, however, take into account that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one issue worth mentioning. Land Securities Group currently has a relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in Land Securities Group's case is 47%. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.

Next Steps:

There are too many aspects of Land Securities Group to cover in one brief article, but the key fundamentals for the company can all be found in one place – Land Securities Group's company page on Simply Wall St. We've also compiled a list of important aspects you should further research:

  1. Valuation: What is Land Securities Group worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Land Securities Group is currently mispriced by the market.
  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Land Securities Group’s board and the CEO’s background.
  3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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