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What Should Investors Know About The Future Of AEGON NV.’s (AMS:AGN)?

Brandon Murphy

In December 2017, AEGON NV. (ENXTAM:AGN) released its latest earnings announcement, which revealed that the business benefited from a substantial tailwind, more than doubling its earnings from the prior year. Below, I’ve laid out key numbers on how market analysts predict AEGON’s earnings growth trajectory over the next couple of years and whether the future looks even brighter than the past. Note that I will be looking at net income excluding extraordinary items to get a better understanding of the underlying drivers of earnings. See our latest analysis for AEGON

Market analysts’ prospects for next year seems pessimistic, with earnings falling by a double-digit -39.31%. Over the medium term, earnings should continue to be below today’s level, with a decline of -35.10% in 2020, eventually reaching €1.45B in 2021.

ENXTAM:AGN Future Profit Mar 23rd 18

While it is helpful to understand the rate of growth year by year relative to today’s figure, it may be more beneficial analyzing the rate at which the business is growing every year, on average. The benefit of this method is that it removes the impact of near term flucuations and accounts for the overarching direction of AEGON’s earnings trajectory over time, which may be more relevant for long term investors. To calculate this rate, I’ve appended a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is -8.10%. This means that, we can expect AEGON will chip away at a rate of -8.10% every year for the next couple of years.

Next Steps:

For AEGON, I’ve put together three relevant factors 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 AGN 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 AGN is currently mispriced by the market.
  3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of AGN? 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.