As ING Groep N.V. (AMS:INGA) announced its earnings release on 30 June 2019, the consensus outlook from analysts appear somewhat bearish, with profits predicted to rise by 9.3% next year compared with the higher past 5-year average growth rate of 12%. With trailing-twelve-month net income at current levels of €4.8b, we should see this rise to €5.2b in 2020. Below is a brief commentary on the longer term outlook the market has for ING Groep. For those interested in more of an analysis of the company, you can research its fundamentals here.
What can we expect from ING Groep in the longer term?
The view from 19 analysts over the next three years is one of positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. 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 INGA's earnings growth over these next few years.
This results in an annual growth rate of 1.6% based on the most recent earnings level of €4.8b to the final forecast of €5.3b by 2022. This leads to an EPS of €1.34 in the final year of projections relative to the current EPS of €1.22. Analysts are predicting earnings growth to outpace revenue by the end of 2022, resulting in a margin expansion from 27% to 27%.
Future outlook is only one aspect when you're building an investment case for a stock. For ING Groep, there are three essential aspects you should look at:
- 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 ING Groep 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 ING Groep is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of ING Groep? 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.