In December 2018, Bolsas y Mercados Españoles, Sociedad Holding de Mercados y Sistemas Financieros, S.A. (BME:BME) announced its most recent earnings update, which confirmed that the business experienced a immense headwind with earnings deteriorating by -11%. Below, I’ve presented key growth figures on how market analysts perceive Bolsas y Mercados Españoles Sociedad Holding de Mercados y Sistemas Financieros’s earnings growth outlook over the next few years and whether the future looks brighter. Note that I will be looking at net income excluding extraordinary items to get a better understanding of the underlying drivers of earnings.
Market analysts’ consensus outlook for the coming year seems pessimistic, with earnings decreasing by -2.7%. But in the following year, there is a complete contrast in performance, with reaching double digit 4.4% compared to today’s level and continues to increase to €143m in 2022.
While it is informative knowing the growth year by year relative to today’s value, it may be more beneficial to gauge the rate at which the company is moving on average every year. The advantage of this approach is that it removes the impact of near term flucuations and accounts for the overarching direction of Bolsas y Mercados Españoles Sociedad Holding de Mercados y Sistemas Financieros’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 analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is 1.9%. This means that, we can presume Bolsas y Mercados Españoles Sociedad Holding de Mercados y Sistemas Financieros will grow its earnings by 1.9% every year for the next couple of years.
For Bolsas y Mercados Españoles Sociedad Holding de Mercados y Sistemas Financieros, I’ve compiled three pertinent 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 BME 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 BME is currently mispriced by the market.
- Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of BME? 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.