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What Should We Expect From Kesko Oyj's (HEL:KESKOB) Earnings In The Next 12 Months?

Simply Wall St

After Kesko Oyj's (HEL:KESKOB) earnings announcement in June 2019, the consensus outlook from analysts appear somewhat bearish, as a 17% rise in profits is expected in the upcoming year, against the higher past 5-year average growth rate of 20%. By 2020, we can expect Kesko Oyj’s bottom line to reach €252m, a jump from the current trailing-twelve-month of €216m. In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for Kesko Oyj in the longer term. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.

See our latest analysis for Kesko Oyj

How will Kesko Oyj perform in the near future?

The longer term view from the 4 analysts covering KESKOB is one of positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. To understand the overall trajectory of KESKOB'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.

HLSE:KESKOB Past and Future Earnings, August 31st 2019

By 2022, KESKOB's earnings should reach €263m, from current levels of €216m, resulting in an annual growth rate of 3.7%. EPS reaches €3.04 in the final year of forecast compared to the current €2.18 EPS today. With a current profit margin of 2.1%, this movement will result in a margin of 2.3% by 2022.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Kesko Oyj, there are three pertinent 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 Kesko Oyj 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 Kesko Oyj is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Kesko Oyj? 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.