What Should Investors Know About Amadeus IT Group, S.A.’s (BME:AMS) Future?
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Based on Amadeus IT Group, S.A.’s (BME:AMS) earnings update in September 2018, analyst consensus outlook appear cautiously subdued, with earnings expected to grow by 5.4% in the upcoming year compared with the higher past 5-year average growth rate of 14%. Presently, with latest-twelve-month earnings at €1.0b, we should see this growing to €1.1b by 2020. Below is a brief commentary on the longer term outlook the market has for Amadeus IT Group. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.
See our latest analysis for Amadeus IT Group
How is Amadeus IT Group going to perform in the near future?
The 23 analysts covering AMS view its longer term outlook with a positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. To get an idea of the overall earnings growth trend for AMS, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.
From the current net income level of €1.0b and the final forecast of €1.2b by 2022, the annual rate of growth for AMS’s earnings is 7.4%. This leads to an EPS of €3.09 in the final year of projections relative to the current EPS of €2.29. Margins are currently sitting at 21%, approximately the same as previous years. With analysts forecasting revenue growth of 0.24842 and AMS’s net income growth expected to roughly track that, this company may add value for shareholders over time.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For Amadeus IT Group, I’ve compiled three relevant aspects 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 Amadeus IT Group 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 Amadeus IT Group is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Amadeus IT Group? 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 past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
