What Should We Expect From STADA Arzneimittel Aktiengesellschaft’s (FRA:SAZ) Earnings In The Year Ahead?
In December 2017, STADA Arzneimittel Aktiengesellschaft (DB:SAZ) released its most recent earnings update. Generally, analysts seem highly optimistic, with earnings expected to more than double in the upcoming year, relative to the previous 5-year average growth rate of 9.39%. Presently, with earnings at €85.32M, we should see this growing to €228.75M by 2019. Below is a brief commentary on the longer term outlook the market has for STADA Arzneimittel. For those keen to understand more about other aspects of the company, you can research its fundamentals here. Check out our latest analysis for STADA Arzneimittel
Exciting times ahead?
The longer term view from the 7 analysts covering SAZ 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. 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 SAZ’s earnings growth over these next few years.
This results in an annual growth rate of 20.55% based on the most recent earnings level of €85.32M to the final forecast of €247.41M by 2021. EPS reaches €3.97 in the final year of forecast compared to the current €1.37 EPS today. Earnings growth appears to be a result of cost-cutting initiatives, since top-line is predicted to rise at a slower pace than earnings. Margins is currently sitting at 3.69%, which is expected to expand to 9.22% by 2021.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For STADA Arzneimittel, there are 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 STADA Arzneimittel 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 STADA Arzneimittel is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of STADA Arzneimittel? 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.
