In December 2018, Gjensidige Forsikring ASA (OB:GJF) announced its earnings update. Overall, analyst consensus outlook appear vastly optimistic, with profits predicted to ramp up by an impressive 63% next year, compared with the historical 5-year average growth rate of -1.6%. With trailing-twelve-month net income at current levels of øre3.4b, we should see this rise to øre5.5b in 2020. Below is a brief commentary on the longer term outlook the market has for Gjensidige Forsikring. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
Exciting times ahead?
The view from 10 analysts over the next three years 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.
By 2022, GJF’s earnings should reach øre4.1b, from current levels of øre3.4b, resulting in an annual growth rate of 2.0%. This leads to an EPS of NOK8.26 in the final year of projections relative to the current EPS of NOK6.77. Margins are currently sitting at 13%, which is expected to expand to 16% by 2022.
Future outlook is only one aspect when you’re building an investment case for a stock. For Gjensidige Forsikring, there are three fundamental aspects 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 Gjensidige Forsikring 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 Gjensidige Forsikring is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Gjensidige Forsikring? 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.