Huntington Bancshares Incorporated’s (NASDAQ:HBAN) most recent earnings update in December 2018 signalled that the company experienced a robust tailwind, eventuating to a double-digit earnings growth of 19%. Below, I’ve presented key growth figures on how market analysts view Huntington Bancshares’s earnings growth outlook over the next few years and whether the future looks even brighter than the past. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings.
Analysts’ expectations for this coming year seems rather muted, with earnings rising by a single digit 7.1%. The growth outlook in the following year seems much more buoyant with rates reaching double digit 10% compared to today’s earnings, and finally hitting US$1.5b by 2022.
Even though it is helpful to be aware of the growth year by year relative to today’s figure, it may be more insightful to evaluate the rate at which the business is rising or falling on average every year. The pro of this technique is that it ignores near term flucuations and accounts for the overarching direction of Huntington Bancshares’s earnings trajectory over time, which may be more relevant for long term investors. To calculate this rate, I’ve appended a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 4.9%. This means that, we can anticipate Huntington Bancshares will grow its earnings by 4.9% every year for the next couple of years.
For Huntington Bancshares, I’ve put together 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 HBAN 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 HBAN is currently mispriced by the market.
- Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of HBAN? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
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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.