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secunet Security Networks Aktiengesellschaft (ETR:YSN): What We Can Expect From This Growth Stock

Simply Wall St

Based on secunet Security Networks Aktiengesellschaft's (ETR:YSN) earnings update in December 2018, analyst consensus outlook appear cautiously subdued, with earnings expected to grow by 15% in the upcoming year relative to the higher past 5-year average growth rate of 39%. With trailing-twelve-month net income at current levels of €18m, we should see this rise to €21m in 2020. In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for secunet Security Networks in the longer term. For those interested in more of an analysis of the company, you can research its fundamentals here.

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View our latest analysis for secunet Security Networks

What can we expect from secunet Security Networks in the longer term?

The longer term expectations from the 2 analysts of YSN is tilted towards the 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 YSN's earnings growth over these next few years.

XTRA:YSN Past and Future Earnings, May 21st 2019

By 2022, YSN's earnings should reach €26m, from current levels of €18m, resulting in an annual growth rate of 15%. This leads to an EPS of €4.04 in the final year of projections relative to the current EPS of €2.77. Margins are currently sitting at 11%, which is expected to expand to 12% by 2022.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For secunet Security Networks, I've compiled three pertinent aspects 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 secunet Security Networks 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 secunet Security Networks is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of secunet Security Networks? 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.