What Are Analysts Expecting From Wolters Kluwer N.V. (AMS:WKL) In The Year Ahead?
As Wolters Kluwer N.V. (AMS:WKL) announced its recent earnings release on 31 December 2018, the consensus outlook from analysts appear pessimistic, with earnings expected to decline by -7.3% in the upcoming year compared with the past 5-year average growth rate of 14%. Currently with a trailing-twelve-month profit of €657m, the consensus growth rate suggests that earnings will drop to €609m by 2020. In this article, I’ve outline a few earnings growth rates to give you a sense of the market sentiment for Wolters Kluwer in the longer term. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.
View our latest analysis for Wolters Kluwer
How will Wolters Kluwer perform in the near future?
The 17 analysts covering WKL view its longer term outlook with a positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. To understand the overall trajectory of WKL’s earnings growth over these next fews years, I’ve fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope.
This results in an annual growth rate of 1.8% based on the most recent earnings level of €657m to the final forecast of €690m by 2022. This leads to an EPS of €2.66 in the final year of projections relative to the current EPS of €2.37. This high rate of growth of revenue squeezes margins, as analysts predict an upcoming margin contraction from the current 15% to 14% by the end of 2022.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For Wolters Kluwer, I’ve compiled three key 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 Wolters Kluwer 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 Wolters Kluwer is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Wolters Kluwer? 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.
