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Mapfre, S.A. (BME:MAP): Poised For Long Term Success?

Simply Wall St

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After Mapfre, S.A.'s (BME:MAP) earnings announcement in December 2018, it seems that analyst forecasts are fairly optimistic, with earnings expected to grow by 48% in the upcoming year relative to the past 5-year average growth rate of -2.4%. Presently, with latest-twelve-month earnings at €529m, we should see this growing to €784m by 2020. Below is a brief commentary around Mapfre'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.

See our latest analysis for Mapfre

What can we expect from Mapfre in the longer term?

The 7 analysts covering MAP view its longer term outlook with a positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. To get an idea of the overall earnings growth trend for MAP, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.

BME:MAP Past and Future Earnings, April 3rd 2019

This results in an annual growth rate of 10% based on the most recent earnings level of €529m to the final forecast of €886m by 2022. This leads to an EPS of €0.29 in the final year of projections relative to the current EPS of €0.17. Margins are currently sitting at 2.5%, which is expected to expand to 3.6% by 2022.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Mapfre, I've compiled three fundamental factors you should further research:

  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 Mapfre 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 Mapfre is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Mapfre? 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.