The most recent earnings release Swiss Life Holding AG's (VTX:SLHN) announced in December 2018 signalled that the company gained from a small tailwind, eventuating to a single-digit earnings growth of 6.9%. Below is my commentary, albeit very simple and high-level, on how market analysts predict Swiss Life Holding's earnings growth trajectory over the next few 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 the coming year seems rather subdued, with earnings climbing by a single digit 4.9%. The following year doesn't look much more exciting, though earnings does reach CHF1.2b in 2022.
While it is informative knowing the growth rate year by year relative to today’s figure, it may be more insightful to analyze the rate at which the business is growing every year, on average. The benefit of this approach is that we can get a bigger picture of the direction of Swiss Life Holding's earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To compute 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 4.6%. This means that, we can anticipate Swiss Life Holding will grow its earnings by 4.6% every year for the next few years.
For Swiss Life Holding, I've put together three essential 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 SLHN 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 SLHN is currently mispriced by the market.
- Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of SLHN? 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.