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Will Gr. Sarantis S.A.'s (ATH:SAR) Earnings Grow Over The Next Year?

Simply Wall St

On 31 December 2018, Gr. Sarantis S.A. (ATH:SAR) announced its earnings update. Overall, the consensus outlook from analysts appear somewhat bearish, as a 13% rise in profits is expected in the upcoming year, against the higher past 5-year average growth rate of 16%. With trailing-twelve-month net income at current levels of €33m, we should see this rise to €37m in 2020. In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for Gr. Sarantis in the longer term. Investors wanting to learn more about other aspects of the company should research its fundamentals here.

Check out our latest analysis for Gr. Sarantis

Exciting times ahead?

Longer term expectations from the 4 analysts covering SAR’s stock 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. To understand the overall trajectory of SAR'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.

ATSE:SAR Past and Future Earnings, April 22nd 2019

From the current net income level of €33m and the final forecast of €47m by 2022, the annual rate of growth for SAR’s earnings is 12%. EPS reaches €0.65 in the final year of forecast compared to the current €0.48 EPS today. In 2022, SAR's profit margin will have expanded from 9.5% to 11%.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Gr. Sarantis, there are three essential aspects you should look at:

  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 Gr. Sarantis 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 Gr. Sarantis is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Gr. Sarantis? 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.