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After Brunello Cucinelli S.p.A.'s (BIT:BC) earnings announcement on 31 December 2018, analyst consensus outlook appear cautiously subdued, as a 8.8% rise in profits is expected in the upcoming year, relative to the higher past 5-year average growth rate of 13%. Presently, with latest-twelve-month earnings at €51m, we should see this growing to €55m by 2020. Below is a brief commentary on the longer term outlook the market has for Brunello Cucinelli. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
Exciting times ahead?
The view from 11 analysts over the next three years is one of positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. 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 BC's earnings growth over these next few years.
From the current net income level of €51m and the final forecast of €62m by 2022, the annual rate of growth for BC’s earnings is 5.9%. EPS reaches €0.91 in the final year of forecast compared to the current €0.75 EPS today. Analysts are predicting this high revenue growth to squeeze profit margins over time, from 9.2% to 8.8% by the end of 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For Brunello Cucinelli, I've put together three pertinent factors 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.
- Valuation: What is Brunello Cucinelli 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 Brunello Cucinelli is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Brunello Cucinelli? 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.