In December 2018, Peoples Bancorp Inc. (NASDAQ:PEBO) released its latest earnings announcement, which suggested that the company benefited from a strong tailwind, eventuating to a double-digit earnings growth of 20%. Below, I've presented key growth figures on how market analysts perceive Peoples Bancorp's earnings growth trajectory over the next couple of years and whether the future looks even brighter than the past. 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' prospects for next year seems positive, with earnings expanding by a robust 19%. This growth seems to continue into the following year with rates arriving at double digit 38% compared to today’s earnings, and finally hitting US$65m by 2022.
Even though it’s helpful to be aware of the rate of growth each year relative to today’s figure, it may be more valuable estimating the rate at which the earnings are moving every year, on average. The pro of this approach is that we can get a bigger picture of the direction of Peoples Bancorp's earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To calculate this rate, I've appended a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 8.4%. This means that, we can assume Peoples Bancorp will grow its earnings by 8.4% every year for the next couple of years.
For Peoples Bancorp, I've compiled three key 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 PEBO 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 PEBO is currently mispriced by the market.
- Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of PEBO? 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 firstname.lastname@example.org. 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.