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Bonduelle SA (EPA:BON): Will The Growth Last?

Jenifer Prater

Based on Bonduelle SA’s (EPA:BON) earnings update in June 2018, analyst forecasts seem fairly subdued, as a 7.3% rise in profits is expected in the upcoming year, compared with the higher past 5-year average growth rate of 11%. With trailing-twelve-month net income at current levels of €72m, we should see this rise to €78m in 2020. I will provide a brief commentary around the figures and analyst expectations in the near term. For those interested in more of an analysis of the company, you can research its fundamentals here.

See our latest analysis for Bonduelle

Exciting times ahead?

The 7 analysts covering BON 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. 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.

ENXTPA:BON Future Profit January 24th 19

From the current net income level of €72m and the final forecast of €98m by 2022, the annual rate of growth for BON’s earnings is 10%. This leads to an EPS of €3.06 in the final year of projections relative to the current EPS of €2.27. Margins are currently sitting at 2.6%, which is expected to expand to 3.3% by 2022.

Next Steps:

Future outlook is only one aspect when you’re building an investment case for a stock. For Bonduelle, I’ve compiled three essential aspects you should further examine:

  1. 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.
  2. Valuation: What is Bonduelle 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 Bonduelle is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Bonduelle? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.