What Are Analysts Saying About H. Lundbeck A/S’s (CPH:LUN) Earnings Trend?
H. Lundbeck A/S’s (CPH:LUN) most recent earnings announcement in December 2018 indicated that the business benefited from a strong tailwind, leading to a double-digit earnings growth of 49%. Below, I’ve laid out key growth figures on how market analysts view H. Lundbeck’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 H. Lundbeck
Market analysts’ consensus outlook for the upcoming year seems pessimistic, with earnings falling by a double-digit -17%. In the next couple of years, earnings will begin to improve, increasing year on year, and arriving at ø3.8b by 2022.
While it is useful to be aware of the rate of growth each year relative to today’s value, it may be more insightful to estimate the rate at which the company is moving every year, on average. The pro of this method is that it ignores near term flucuations and accounts for the overarching direction of H. Lundbeck’s earnings trajectory over time, 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 2.5%. This means that, we can expect H. Lundbeck will grow its earnings by 2.5% every year for the next couple of years.
Next Steps:
For H. Lundbeck, there are three essential factors 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 LUN 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 LUN is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of LUN? 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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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.
