Deinove SA (EPA:ALDEI): Set To Experience A Decrease In Earnings?
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Deinove SA's (EPA:ALDEI) latest earnings announcement in March 2019 indicated company earnings became less negative compared to the previous year's level as a result of recent tailwinds Below, I've laid out key numbers on how market analysts predict Deinove's earnings growth trajectory over the next few years and whether the future looks brighter. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings.
See our latest analysis for Deinove
Market analysts' consensus outlook for the upcoming year seems pessimistic, with earnings becoming even more negative, reaching -€10.9m in 2020. However, earnings are predicted to move into an upward trajectory, generating -€11.2m in 2021, before plateauing to similar levels in 2022.
While it is useful to understand the growth year by year relative to today’s level, it may be more insightful to determine the rate at which the business is growing on average every year. The benefit of this technique is that we can get a bigger picture of the direction of Deinove's earnings trajectory over the long run, irrespective of near term fluctuations, fluctuate up and down. To calculate this rate, I put a line of best fit through analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is -6.9%. This means that, we can presume Deinove will chip away at a rate of -6.9% every year for the next few years.
Next Steps:
For Deinove, I've compiled three essential factors 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 ALDEI 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 ALDEI is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of ALDEI? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
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If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.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.
