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Since Beiersdorf Aktiengesellschaft (ETR:BEI) released its earnings in December 2018, analyst consensus outlook seem conservative, with earnings growth rate expected to be 7.2% next year, which is within range of the past five-year average earnings growth of 6.6%. By 2020, we can expect Beiersdorf’s bottom line to reach €780m, a jump from the current trailing-twelve-month of €728m. I will provide a brief commentary around the figures and analyst expectations in the near term. Investors wanting to learn more about other aspects of the company should research its fundamentals here.
Can we expect Beiersdorf to keep growing?
Longer term expectations from the 23 analysts covering BEI’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 reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.
This results in an annual growth rate of 7.0% based on the most recent earnings level of €728m to the final forecast of €891m by 2022. This leads to an EPS of €3.94 in the final year of projections relative to the current EPS of €3.21. In 2022, BEI's profit margin will have expanded from 10% to 11%.
Future outlook is only one aspect when you're building an investment case for a stock. For Beiersdorf, I've compiled three relevant factors you should look at:
- 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 Beiersdorf 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 Beiersdorf is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Beiersdorf? 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.