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VTG Aktiengesellschaft (FRA:VT9): What Are The Future Prospects?

After VTG Aktiengesellschaft’s (FRA:VT9) earnings announcement in March 2018, analyst consensus outlook appear cautiously subdued, with earnings expected to grow by 15.96% in the upcoming year compared with the higher past 5-year average growth rate of 33.54%. With trailing-twelve-month net income at current levels of €59.50m, we should see this rise to €69.00m in 2019. In this article, I’ve outline a few earnings growth rates to give you a sense of the market sentiment for VTG in the longer term. For those interested in more of an analysis of the company, you can research its fundamentals here.

Check out our latest analysis for VTG

How will VTG perform in the near future?

Longer term expectations from the 9 analysts covering VT9’s stock is one of positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. To reduce the year-on-year volatility of analyst earnings forecast, I’ve inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.

DB:VT9 Future Profit August 14th 18
DB:VT9 Future Profit August 14th 18

By 2021, VT9’s earnings should reach €92.72m, from current levels of €55.60m, resulting in an annual growth rate of 19.56%. This leads to an EPS of €3.21 in the final year of projections relative to the current EPS of €1.93. The bottom-line growth seems to be caused by cost-cutting initiatives, since top-line is predicted to rise at a slower pace than earnings. Margins is currently sitting at 5.44%, which is expected to expand to 7.90% by 2021.

Next Steps:

Future outlook is only one aspect when you’re building an investment case for a stock. For VTG, I’ve compiled three important 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 VTG 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 VTG is currently mispriced by the market.

  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of VTG? 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 editorial-team@simplywallst.com.

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