What Should Investors Know About Heijmans N.V.'s (AMS:HEIJM) Growth?

In December 2018, Heijmans N.V. (AMS:HEIJM) announced its earnings update. Overall, analysts seem highly optimistic, with earnings expected to grow by a high double-digit of 63% in the upcoming year, relative to the historical 5-year average growth rate of 3.5%. Presently, with latest-twelve-month earnings at €20m, we should see this growing to €33m by 2020. Below is a brief commentary on the longer term outlook the market has for Heijmans. Investors wanting to learn more about other aspects of the company should research its fundamentals here.

View our latest analysis for Heijmans

How will Heijmans perform in the near future?

The longer term expectations from the 2 analysts of HEIJM is tilted towards the positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of HEIJM's earnings growth over these next few years.

This results in an annual growth rate of 25% based on the most recent earnings level of €20m to the final forecast of €45m by 2022. This leads to an EPS of €2.08 in the final year of projections relative to the current EPS of €0.96. With a current profit margin of 1.3%, this movement will result in a margin of 2.7% by 2022.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Heijmans, there are three essential aspects 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 Heijmans 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 Heijmans is currently mispriced by the market.
3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Heijmans? 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 editorial-team@simplywallst.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.