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What Should We Expect From Münchener Rückversicherungs-Gesellschaft Aktiengesellschaft's (FRA:MUV2) Earnings In The Year Ahead?

Simply Wall St

After Münchener Rückversicherungs-Gesellschaft Aktiengesellschaft's (FRA:MUV2) earnings announcement in March 2019, analyst consensus outlook appear cautiously optimistic, with profits predicted to increase by 27% next year compared with the past 5-year average growth rate of -19%. By 2020, we can expect Münchener Rückversicherungs-Gesellschaft’s bottom line to reach €2.9b, a jump from the current trailing-twelve-month of €2.3b. I will provide a brief commentary around the figures and analyst expectations in the near term. Investors wanting to learn more about other aspects of the company should research its fundamentals here.

See our latest analysis for Münchener Rückversicherungs-Gesellschaft

Exciting times ahead?

The longer term view from the 17 analysts covering MUV2 is one of positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of MUV2's earnings growth over these next few years.

DB:MUV2 Past and Future Earnings, July 25th 2019

This results in an annual growth rate of 5.0% based on the most recent earnings level of €2.3b to the final forecast of €3.2b by 2022. EPS reaches €21.76 in the final year of forecast compared to the current €15.53 EPS today. With a current profit margin of 4.4%, this movement will result in a margin of 6.1% by 2022.

Next Steps:

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