Based on the latest analyst predictions, L Brands Inc (NYSE:LB) is estimated to sizably grow its earnings by 14.90% in the upcoming three years. Presently, with an EPS of $3.442, we can expect an upcoming EPS of $3.954. To determine whether this growth rate expectation is justified, we should take a look at how the company has been performing in the past. View our latest analysis for L Brands

How is LB going to perform in the future?

Analyst expectation from the stock’s 27 analysts is one of positive sentiment, with earnings estimated to expand from current levels of $3.442 to $3.954 over the next couple of years. This illustrates a relatively optimistic outlook in the near term, with a relatively solid earnings per share growth rate of 14.90% over the next few years. During the same time we will see the revenue grow from $12,262M to $13,795M and profit is predicted to escalate from $986M to $1,133M in the next couple of years, growing by 14.90%. Margins are expected to be rather acceptable at 8.10%.

Is the growth built on solid basis?

The past can be a helpful indicator for future performance for a stock. We can determine whether this level of expected growth is illustrative of future headwinds or whether the company continues to grapple with higher growth. LB delivered a high double-digit growth rate in the past year, compared to the less exciting rate expected this year. This may indicate a more sustainable level of growth as the company comes off a high-growth period. On the other hand, a more pessimistic outlook questions the company’s ability to continue as a high performer.

Next Steps:

For LB, I’ve put together three important aspects you should further examine:

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 LB 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 LB is currently mispriced by the market.

3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of LB? 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.