Based on Dermapharm Holding SE's (ETR:DMP) earnings update in March 2019, it seems that analyst forecasts are fairly optimistic, with earnings expected to grow by 37% in the upcoming year compared with the past 5-year average growth rate of 30%. By 2020, we can expect Dermapharm Holding’s bottom line to reach €103m, a jump from the current trailing-twelve-month of €75m. Below is a brief commentary on the longer term outlook the market has for Dermapharm Holding. Investors wanting to learn more about other aspects of the company should research its fundamentals here.
How will Dermapharm Holding perform in the near future?
The longer term expectations from the 2 analysts of DMP is tilted towards the positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. 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 DMP's earnings growth over these next few years.
From the current net income level of €75m and the final forecast of €129m by 2022, the annual rate of growth for DMP’s earnings is 12%. EPS reaches €2.31 in the final year of forecast compared to the current €1.41 EPS today. In 2022, DMP's profit margin will have expanded from 13% to 18%.
Future outlook is only one aspect when you're building an investment case for a stock. For Dermapharm Holding, I've put together three key 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 Dermapharm Holding 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 Dermapharm Holding is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Dermapharm Holding? 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.