What Should Investors Know About Intelsat SA.’s (NYSE:I) Future?
Intelsat SA.’s (NYSE:I) latest earnings announcement in December 2017 showed that the company entered the red zone with earnings dropping into the negative territory due to recent headwinds. Below is my commentary, albeit very simple and high-level, on how market analysts perceive Intelsat’s earnings growth trajectory over the next few years and whether the future looks brighter. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings. View our latest analysis for Intelsat
Market analysts’ consensus outlook for the coming year seems relatively muted, with earnings continuing to flop around in the negative territory, reaching -US$182.20M in 2019. However, earnings are predicted to move into an upward trajectory, generating -US$162.31M in 2020, and -US$69.00M in 2021.
While it is helpful to understand the growth rate year by year relative to today’s value, it may be more valuable to analyze the rate at which the company is rising or falling on average every year. The pro of this method is that it removes the impact of near term flucuations and accounts for the overarching direction of Intelsat’s earnings trajectory over time, which may be more relevant for long term investors. To calculate this rate, I’ve inserted a line of best fit through analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is 21.62%. This means, we can assume Intelsat will grow its earnings by 21.62% every year for the next few years.
Next Steps:
For Intelsat, I’ve compiled three fundamental aspects you should further research:
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 I 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 I is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of I? 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.
