In This Article:
Looking at VINCI SA’s (EPA:DG) earnings update in June 2018, the consensus outlook from analysts appear somewhat bearish, as a 4.2% rise in profits is expected in the upcoming year, relative to the higher past 5-year average growth rate of 6.8%. Presently, with latest-twelve-month earnings at €3.0b, we should see this growing to €3.1b by 2019. In this article, I’ve outline a few earnings growth rates to give you a sense of the market sentiment for VINCI in the longer term. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
See our latest analysis for VINCI
What can we expect from VINCI in the longer term?
The longer term view from the 16 analysts covering DG 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. To understand the overall trajectory of DG’s earnings growth over these next fews years, I’ve fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope.
From the current net income level of €2.7b and the final forecast of €3.4b by 2021, the annual rate of growth for DG’s earnings is 7.5%. EPS reaches €6.63 in the final year of forecast compared to the current €4.95 EPS today. Growth in earnings appears to be a result of cost cutting activities, as revenues is expected to grow much slower than earnings. With a current profit margin of 6.7%, this movement will result in a margin of 7.4% by 2021.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For VINCI, I’ve compiled three fundamental aspects you should further examine:
-
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.
-
Valuation: What is VINCI 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 VINCI is currently mispriced by the market.
-
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of VINCI? 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.