What Should You Know About Criteo S.A.’s (NASDAQ:CRTO) Future?
Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
Looking at Criteo S.A.’s (NASDAQ:CRTO) earnings update in September 2018, the consensus outlook from analysts appear bearish, as a -20% fall in profits is expected in the upcoming year against the past 5-year average growth rate of 35%. Presently, with latest-twelve-month earnings at US$91m, we should see this fall to US$73m by 2020. I will provide a brief commentary around the figures and analyst expectations in the near term. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.
See our latest analysis for Criteo
How will Criteo perform in the near future?
The view from 18 analysts over the next three years is one of positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. I’ve plotted out each year’s earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of CRTO’s earnings growth over these next few years.
From the current net income level of US$91m and the final forecast of US$113m by 2022, the annual rate of growth for CRTO’s earnings is 6.0%. However, if we exclude extraordinary items from net income, we see that earnings is projected to fall over time, resulting in an EPS of $1.29 in the final year of forecast compared to the current $1.4 EPS today. In 2022, CRTO’s profit margin will have expanded from 4.0% to 9.9%.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For Criteo, there are three pertinent 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 Criteo 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 Criteo is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Criteo? 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.
