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Looking at ICICI Prudential Life Insurance Company Limited’s (NSE:ICICIPRULI) earnings update in September 2018, it seems that analyst expectations are fairly bearish, with profits predicted to rise by 0.8% next year compared with the higher past 5-year average growth rate of 2.5%. By 2019, we can expect ICICI Prudential Life Insurance’s bottom line to reach ₹19b, a jump from the current trailing-twelve-month ₹19b. Below is a brief commentary around ICICI Prudential Life Insurance’s earnings outlook going forward, which may give you a sense of market sentiment for the company. Investors wanting to learn more about other aspects of the company should research its fundamentals here.
Check out our latest analysis for ICICI Prudential Life Insurance
Exciting times ahead?
The view from 19 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 ICICIPRULI’s earnings growth over these next few years.
This results in an annual growth rate of 11% based on the most recent earnings level of ₹19b to the final forecast of ₹23b by 2021. EPS reaches ₹14.15 in the final year of forecast compared to the current ₹13.19 EPS today. Analysts are predicting earnings growth to outpace revenue by the end of 2021, resulting in a margin expansion from 4.9% to 4.9%.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For ICICI Prudential Life Insurance, I’ve compiled three key factors you should look at:
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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 ICICI Prudential Life Insurance 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 ICICI Prudential Life Insurance 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 ICICI Prudential Life Insurance? 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.