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How Do Analysts See Axalta Coating Systems Ltd. (NYSE:AXTA) Performing Over The Next Year?

Simply Wall St

Based on Axalta Coating Systems Ltd.'s (NYSE:AXTA) earnings update in March 2019, the consensus outlook from analysts appear highly confident, as a 99% rise in profits is expected in the upcoming year, compared with the past 5-year average growth rate of 44%. Presently, with latest-twelve-month earnings at US$207m, we should see this growing to US$413m by 2020. In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for Axalta Coating Systems in the longer term. For those keen to understand more about other aspects of the company, you can research its fundamentals here.

See our latest analysis for Axalta Coating Systems

Exciting times ahead?

Longer term expectations from the 16 analysts covering AXTA’s stock is one of positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. To get an idea of the overall earnings growth trend for AXTA, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.

NYSE:AXTA Past and Future Earnings, July 24th 2019

By 2022, AXTA's earnings should reach US$481m, from current levels of US$207m, resulting in an annual growth rate of 13%. EPS reaches $1.77 in the final year of forecast compared to the current $0.87 EPS today. Margins are currently sitting at 4.4%, which is expected to expand to 9.5% by 2022.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Axalta Coating Systems, I've compiled three essential factors you should look at:

  1. 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.
  2. Valuation: What is Axalta Coating Systems 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 Axalta Coating Systems is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Axalta Coating Systems? 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 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.