Looking at Scout24 AG’s (FRA:G24) earnings update in June 2018, analyst consensus outlook appear cautiously optimistic, with earnings expected to grow by 26% in the upcoming year, though this is noticeably lower than the previous 5-year average earnings growth of 66%. Currently with trailing-twelve-month earnings of €122m, we can expect this to reach €154m by 2019. Below is a brief commentary on the longer term outlook the market has for Scout24. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
What can we expect from Scout24 in the longer term?
Over the next three years, it seems the consensus view of the 14 analysts covering G24 is skewed towards the positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. To understand the overall trajectory of G24’s earnings growth over these next fews years, I’ve fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope.
By 2021, G24’s earnings should reach €191m, from current levels of €111m, resulting in an annual growth rate of 17%. This leads to an EPS of €1.96 in the final year of projections relative to the current EPS of €1.03. 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, G24’s profit margin will have expanded from 22% to 28%.
Future outlook is only one aspect when you’re building an investment case for a stock. For Scout24, I’ve put together three fundamental 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 Scout24 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 Scout24 is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Scout24? 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 email@example.com.