After Fortive Corporation’s (NYSE:FTV) earnings announcement in March 2019, the consensus outlook from analysts appear fairly confident, with earnings expected to grow by 21% in the upcoming year compared with the past 5-year average growth rate of 1.1%. Presently, with latest-twelve-month earnings at US$883m, we should see this growing to US$1.1b by 2020. Below is a brief commentary around Fortive’s earnings outlook going forward, which may give you a sense of market sentiment for the company. Investors wanting to learn more about other aspects of the company should research its fundamentals here.
Exciting times ahead?
The longer term view from the 15 analysts covering FTV is one of positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. 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 FTV’s earnings growth over these next few years.
By 2022, FTV’s earnings should reach US$1.4b, from current levels of US$883m, resulting in an annual growth rate of 14%. EPS reaches $3.73 in the final year of forecast compared to the current $2.56 EPS today. With a current profit margin of 14%, this movement will result in a margin of 17% by 2022.
Future outlook is only one aspect when you’re building an investment case for a stock. For Fortive, there are three important aspects you should further examine:
- 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 Fortive 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 Fortive is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Fortive? 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.