Since Industrias Bachoco, S.A.B. de C.V. (NYSE:IBA) released its earnings in June 2019, analysts seem cautiously optimistic, with profits predicted to increase by 43% next year against the past 5-year average growth rate of 2.3%. With trailing-twelve-month net income at current levels of Mex$3.3b, we should see this rise to Mex$4.8b in 2020. Below is a brief commentary around Industrias Bachoco. de's earnings outlook going forward, which may give you a sense of market sentiment for the company. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.
What can we expect from Industrias Bachoco. de in the longer term?
The view from 5 analysts over the next three years is one of positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. 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 IBA's earnings growth over these next few years.
From the current net income level of Mex$3.3b and the final forecast of Mex$6.4b by 2022, the annual rate of growth for IBA’s earnings is 14%. EPS reaches MX$89.35 in the final year of forecast compared to the current MX$67 EPS today. With a current profit margin of 5.5%, this movement will result in a margin of 8.8% by 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For Industrias Bachoco. de, I've put together three relevant factors 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 Industrias Bachoco. de 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 Industrias Bachoco. de is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Industrias Bachoco. de? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.