Looking at Intesa Sanpaolo S.p.A.'s (BIT:ISP) earnings update in March 2019, analyst consensus outlook appear pessimistic, with earnings expected to decline by 1.1% in the upcoming year compared with the past 5-year average growth rate of 45%. With trailing-twelve-month net income at current levels of €4.1b, the consensus growth rate suggests that earnings will decline to €4.0b by 2020. In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for Intesa Sanpaolo in the longer term. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
How will Intesa Sanpaolo perform in the near future?
The 20 analysts covering ISP view its longer term outlook with a positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly 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 ISP's earnings growth over these next few years.
By 2022, ISP's earnings should reach €4.7b, from current levels of €4.1b, resulting in an annual growth rate of 7.3%. This leads to an EPS of €0.25 in the final year of projections relative to the current EPS of €0.24. However, the near term margins may change heading into 2022, from the current levels of 26% to 25%.
Future outlook is only one aspect when you're building an investment case for a stock. For Intesa Sanpaolo, I've compiled 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 Intesa Sanpaolo 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 Intesa Sanpaolo is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Intesa Sanpaolo? 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.