In December 2018, Aéroports de Paris SA (EPA:ADP) released its earnings update. Generally, analyst consensus outlook appear cautiously subdued, with earnings expected to grow by 3.5% in the upcoming year relative to the higher past 5-year average growth rate of 13%. Currently with trailing-twelve-month earnings of €610m, we can expect this to reach €631m by 2020. Below is a brief commentary on the longer term outlook the market has for Aéroports de Paris. For those interested in more of an analysis of the company, you can research its fundamentals here.
What can we expect from Aéroports de Paris in the longer term?
The view from 16 analysts over the next three years is one of positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. To reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.
This results in an annual growth rate of 6.0% based on the most recent earnings level of €610m to the final forecast of €732m by 2022. EPS reaches €7.37 in the final year of forecast compared to the current €6.16 EPS today. In 2022, ADP's profit margin will have expanded from 14% to 15%.
Future outlook is only one aspect when you're building an investment case for a stock. For Aéroports de Paris, I've put together 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 Aéroports de Paris 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 Aéroports de Paris is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Aéroports de Paris? 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 email@example.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.