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RSA Insurance Group plc (LON:RSA): What Does The Future Look Like?

Looking at RSA Insurance Group plc’s (LSE:RSA) earnings update in December 2017, analysts seem extremely confident, with earnings expected to grow by a high double-digit of 95.45% in the upcoming year, relative to the previous 5-year average growth rate of -18.00%. By 2019, we can expect RSA Insurance Group’s bottom line to reach UK£525.76M, a jump from the current UK£269.00M. I will provide a brief commentary around the figures and analyst expectations in the near term. For those keen to understand more about other aspects of the company, you can research its fundamentals here. See our latest analysis for RSA Insurance Group

How is RSA Insurance Group going to perform in the near future?

The view from 11 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 RSA’s earnings growth over these next few years.

LSE:RSA Future Profit Mar 20th 18
LSE:RSA Future Profit Mar 20th 18

From the current net income level of UK£269.00M and the final forecast of UK£582.51M by 2021, the annual rate of growth for RSA’s earnings is 17.18%. This leads to an EPS of £0.56 in the final year of projections relative to the current EPS of £0.26. Growth in the bottom line seems to suggest reduction in costs rather than purely top-line expansion as earnings is increasing at a faster rate. In 2021, RSA’s profit margin will have expanded from 3.79% to 7.97%.

Next Steps:

Future outlook is only one aspect when you’re building an investment case for a stock. For RSA Insurance Group, there are three fundamental aspects you should further examine:

  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 RSA 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 RSA 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 RSA 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!


To help readers see pass 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.

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