In March 2019, Vestas Wind Systems A/S (CPH:VWS) announced its earnings update. Overall, the consensus outlook from analysts appear fairly confident, with profits predicted to increase by 35% next year compared with the past 5-year average growth rate of 18%. By 2020, we can expect Vestas Wind Systems’s bottom line to reach €921m, a jump from the current trailing-twelve-month of €684m. Below is a brief commentary around Vestas Wind Systems's earnings outlook going forward, which may give you a sense of market sentiment for the company. For those interested in more of an analysis of the company, you can research its fundamentals here.
How will Vestas Wind Systems perform in the near future?
Over the next three years, it seems the consensus view of the 19 analysts covering VWS is skewed towards the positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. To understand the overall trajectory of VWS's earnings growth over these next fews years, I've fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope.
By 2022, VWS's earnings should reach €1.1b, from current levels of €684m, resulting in an annual growth rate of 11%. EPS reaches €4.84 in the final year of forecast compared to the current €3.41 EPS today. With a current profit margin of 6.7%, this movement will result in a margin of 9.7% by 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For Vestas Wind Systems, I've compiled three important 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 Vestas Wind 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 Vestas Wind Systems is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Vestas Wind 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 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.