The latest earnings announcement Alliant Energy Corporation (NASDAQ:LNT) released in December 2018 suggested that the business experienced a strong tailwind, eventuating to a double-digit earnings growth of 12%. Today I want to provide a brief commentary on how market analysts view Alliant Energy’s earnings growth outlook over the next few 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.
See our latest analysis for Alliant Energy
Market analysts’ consensus outlook for next year seems rather muted, with earnings increasing by a single digit 6.0%. The growth outlook in the following year seems much more buoyant with rates reaching double digit 14% compared to today’s earnings, and finally hitting US$631m by 2022.
Even though it is useful to be aware of the growth rate year by year relative to today’s value, it may be more valuable to evaluate the rate at which the earnings are growing every year, on average. The benefit of this technique is that we can get a bigger picture of the direction of Alliant Energy’s earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To compute 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 7.0%. This means that, we can assume Alliant Energy will grow its earnings by 7.0% every year for the next couple of years.
Next Steps:
For Alliant Energy, I’ve put together three pertinent aspects you should further research:
- 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.
- Future Earnings: How does LNT’s growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart.
- Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of LNT? 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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