After Raymond James Financial Inc’s (NYSE:RJF) earnings announcement on 30 September 2018, the consensus outlook from analysts appear fairly confident, with profits predicted to increase by 29% next year against the past 5-year average growth rate of 13%. With trailing-twelve-month net income at current levels of US$855m, we should see this rise to US$1.1b in 2019. Below is a brief commentary around Raymond James Financial’s earnings outlook going forward, which may give you a sense of market sentiment for the company. For those interested in more of an analysis of the company, you can research its fundamentals here.
How is Raymond James Financial going to perform in the near future?
The 8 analysts covering RJF view its longer term outlook with a positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. To reduce the year-on-year volatility of analyst earnings forecast, I’ve inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.
This results in an annual growth rate of 15% based on the most recent earnings level of US$855m to the final forecast of US$1.3b by 2021. EPS reaches $9.05 in the final year of forecast compared to the current $5.89 EPS today. With a current profit margin of 12%, this movement will result in a margin of 14% by 2021.
Future outlook is only one aspect when you’re building an investment case for a stock. For Raymond James Financial, there are three fundamental factors 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 Raymond James Financial 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 Raymond James Financial is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Raymond James Financial? 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 firstname.lastname@example.org.