In This Article:
Christian Dior SE’s (ENXTPA:CDI) latest earnings announcement in December 2017 confirmed that the company benefited from a small tailwind, leading to a single-digit earnings growth of 5.86%. Below is my commentary, albeit very simple and high-level, on how market analysts perceive Christian Dior’s earnings growth outlook over the next few years and whether the future looks even brighter than the past. Note that I will be looking at net income excluding extraordinary items to get a better understanding of the underlying drivers of earnings. See our latest analysis for Christian Dior
Analysts’ expectations for this coming year seems rather subdued, with earnings climbing by a single digit 1.92%. The growth outlook in the following year seems much more buoyant with rates arriving at double digit 10.22% compared to today’s earnings, and finally hitting €2.70B by 2021.
While it is useful to understand the growth each year relative to today’s figure, it may be more valuable to analyze the rate at which the business is growing on average every year. The pro of this method is that it ignores near term flucuations and accounts for the overarching direction of Christian Dior’s earnings trajectory over time, which may be more relevant for long term investors. To compute this rate, I’ve inserted 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 6.47%. This means, we can presume Christian Dior will grow its earnings by 6.47% every year for the next couple of years.
Next Steps:
For Christian Dior, I’ve compiled three important aspects you should further research:
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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 CDI 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 CDI 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 CDI? 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.