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What Should We Expect From CNO Financial Group Inc’s (NYSE:CNO) Earnings In The Years Ahead?

Liliana Gabriel

The most recent earnings release CNO Financial Group Inc’s (NYSE:CNO) announced in December 2017 signalled that the business faced a immense headwind with earnings falling by -50.98%. Investors may find it useful to understand how market analysts view CNO Financial Group’s earnings growth outlook over the next few years and whether the future looks brighter. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in. View our latest analysis for CNO Financial Group

Analysts’ outlook for next year seems positive, with earnings climbing by a significant 88.07%. This level of earnings is expected to be maintained over the next couple of years, plateauing at US$337.01M by 2021.

NYSE:CNO Future Profit Apr 25th 18

Although it is helpful to be aware of the growth rate each year relative to today’s figure, it may be more insightful to determine the rate at which the business is growing on average every year. The pro of this technique is that it removes the impact of near term flucuations and accounts for the overarching direction of CNO Financial Group’s earnings trajectory over time, which may be more relevant for long term investors. To compute this rate, I’ve inserted 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 15.53%. This means that, we can expect CNO Financial Group will grow its earnings by 15.53% every year for the next couple of years.

Next Steps:

For CNO Financial Group, I’ve compiled three fundamental aspects you should further research:

  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 CNO 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 CNO is currently mispriced by the market.
  3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of CNO? 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 pass 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.