Jones Lang LaSalle Incorporated (NYSE:JLL): Is It A Good Long Term Opportunity?

The most recent earnings announcement Jones Lang LaSalle Incorporated’s (NYSE:JLL) released in December 2018 confirmed that the business benefited from a large tailwind, leading to a high double-digit earnings growth of 75%. Below is a brief commentary on my key takeaways on how market analysts view Jones Lang LaSalle’s earnings growth outlook over the next couple of 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.

View our latest analysis for Jones Lang LaSalle

Market analysts’ prospects for this coming year seems rather muted, with earnings climbing by a single digit 6.0%. The growth outlook in the following year seems much more buoyant with rates reaching double digit 18% compared to today’s earnings, and finally hitting US$587m by 2022.

NYSE:JLL Past and Future Earnings, March 24th 2019
NYSE:JLL Past and Future Earnings, March 24th 2019

Even though it’s helpful to understand the growth each year relative to today’s level, it may be more valuable analyzing the rate at which the business is moving every year, on average. The benefit of this approach is that it ignores near term flucuations and accounts for the overarching direction of Jones Lang LaSalle’s earnings trajectory over time, which may be more relevant for long term investors. To calculate this rate, I’ve inserted 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 7.2%. This means, we can assume Jones Lang LaSalle will grow its earnings by 7.2% every year for the next couple of years.

Next Steps:

For Jones Lang LaSalle, I’ve put together three important 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 JLL 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 JLL is currently mispriced by the market.
  3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of JLL? 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.