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What Should We Expect From ENAV S.p.A.’s (BIT:ENAV) Earnings Over The Next Few Years?

Simply Wall St

ENAV S.p.A.’s (BIT:ENAV) latest earnings announcement in December 2018 signalled that the business benefited from a robust tailwind, leading to a double-digit earnings growth of 13%. Below is my commentary, albeit very simple and high-level, on how market analysts perceive ENAV’s earnings growth outlook over the next couple of years and whether the future looks even brighter than the past. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in.

See our latest analysis for ENAV

Market analysts’ consensus outlook for next year seems pessimistic, with earnings declining by -2.5%. But in the following year, there is a complete contrast in performance, with generating double digit 1.2% compared to today’s level and continues to increase to €131m in 2022.

BIT:ENAV Past and Future Earnings, March 18th 2019

Even though it is helpful to be aware of the growth year by year relative to today’s level, it may be more beneficial determining the rate at which the company is rising or falling every year, on average. The advantage of this approach is that we can get a better picture of the direction of ENAV’s earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To calculate this rate, I’ve inserted a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 5.2%. This means that, we can anticipate ENAV will grow its earnings by 5.2% every year for the next couple of years.

Next Steps:

For ENAV, I’ve compiled three key 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 ENAV 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 ENAV is currently mispriced by the market.
  3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of ENAV? 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 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.