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What Should You Know About Zurich Insurance Group AG's (VTX:ZURN) Growth?

Simply Wall St

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In December 2018, Zurich Insurance Group AG (VTX:ZURN) released its earnings update. Generally, the consensus outlook from analysts appear fairly confident, with earnings expected to grow by 9.9% in the upcoming year against the past 5-year average growth rate of -5.9%. By 2020, we can expect Zurich Insurance Group’s bottom line to reach US$4.1b, a jump from the current trailing-twelve-month of US$3.7b. Below is a brief commentary on the longer term outlook the market has for Zurich Insurance Group. Investors wanting to learn more about other aspects of the company should research its fundamentals here.

See our latest analysis for Zurich Insurance Group

Exciting times ahead?

The longer term view from the 16 analysts covering ZURN is one of positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. 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 ZURN's earnings growth over these next few years.

SWX:ZURN Past and Future Earnings, June 16th 2019

By 2022, ZURN's earnings should reach US$4.6b, from current levels of US$3.7b, resulting in an annual growth rate of 5.6%. EPS reaches $31.23 in the final year of forecast compared to the current $25.1 EPS today. With a current profit margin of 7.9%, this movement will result in a margin of 8.7% by 2022.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Zurich Insurance Group, I've compiled three key 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 Zurich Insurance Group 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 Zurich Insurance Group is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Zurich Insurance Group? 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 editorial-team@simplywallst.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.