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What Should You Know About Chr Hansen Holding A/S’s (CPH:CHR) Future?

Bryan Cramer

Looking at Chr Hansen Holding A/S’s (CPH:CHR) earnings update in May 2018, analysts seem cautiously optimistic, with profits predicted to increase by 15.27% next year relative to the past 5-year average growth rate of 10.81%. By 2019, we can expect Chr. Hansen Holding’s bottom line to reach €260.86m, a jump from the current trailing-twelve-month €226.30m. Below is a brief commentary around Chr. Hansen Holding’s earnings outlook going forward, which may give you a sense of market sentiment for the company. For those keen to understand more about other aspects of the company, you can research its fundamentals here.

See our latest analysis for Chr. Hansen Holding

Exciting times ahead?

The longer term expectations from the 13 analysts of CHR is tilted towards the positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. To understand the overall trajectory of CHR’s earnings growth over these next fews years, I’ve fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope.

CPSE:CHR Future Profit July 30th 18

By 2021, CHR’s earnings should reach €333.89m, from current levels of €224.00m, resulting in an annual growth rate of 13.05%. EPS reaches €2.54 in the final year of forecast compared to the current €1.7 EPS today. The primary reason for earnings growth is due to reduction in costs rather than purely top-line expansion as earnings is increasing at a faster rate. Margins is currently sitting at 21.08%, which is expected to expand to 24.07% by 2021.

Next Steps:

Future outlook is only one aspect when you’re building an investment case for a stock. For Chr. Hansen Holding, I’ve put together three pertinent 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 Chr. Hansen Holding 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 Chr. Hansen Holding is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Chr. Hansen Holding? 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.