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In December 2017, ACS Actividades de Construcción y Servicios, SA. (BME:ACS) released its latest earnings announcement, which signalled that the business benefited from a significant tailwind, more than doubling its earnings from the prior year. Below, I’ve presented key growth figures on how market analysts view ACS Actividades de Construcción y Servicios’s earnings growth trajectory over the next few years and whether the future looks even brighter than the past. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in. View our latest analysis for ACS Actividades de Construcción y Servicios
Market analysts’ prospects for the upcoming year seems rather subdued, with earnings increasing by a single digit 5.18%. The following years do not look much more exciting, with earnings reaching €873.24M before falling in 2021.
Even though it’s helpful to be aware of the growth rate each year relative to today’s figure, it may be more valuable gauging the rate at which the business is growing every year, on average. The benefit of this technique is that we can get a bigger picture of the direction of ACS Actividades de Construcción y Servicios’s earnings trajectory over the long run, irrespective of near term fluctuations, be more volatile. To calculate this rate, I’ve appended a line of best fit through analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is 0.69%. This means that, we can assume ACS Actividades de Construcción y Servicios will grow its earnings by 0.69% every year for the next couple of years.
Next Steps:
For ACS Actividades de Construcción y Servicios, there are three important aspects you should further examine:
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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.
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Valuation: What is ACS 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 ACS is currently mispriced by the market.
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Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of ACS? 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.