In This Article:
Want to participate in a research study? Help shape the future of investing tools and earn a $60 gift card!
Based on BayWa Aktiengesellschaft's (FRA:BYW) earnings update on 31 December 2018, it seems that analyst forecasts are substantially optimistic, as a 65% rise in profits is expected in the upcoming year, compared with the previous 5-year average growth rate of -28%. With trailing-twelve-month net income at current levels of €32m, we should see this rise to €53m in 2020. Below is a brief commentary around BayWa's earnings outlook going forward, which may give you a sense of market sentiment for the company. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
Check out our latest analysis for BayWa
How is BayWa going to perform in the near future?
Longer term expectations from the 4 analysts covering BYW’s stock 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 BYW's earnings growth over these next few years.
This results in an annual growth rate of 24% based on the most recent earnings level of €32m to the final forecast of €71m by 2022. This leads to an EPS of €2.02 in the final year of projections relative to the current EPS of €0.92. With a current profit margin of 0.2%, this movement will result in a margin of 0.4% by 2022.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For BayWa, I've put together three pertinent factors 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 BayWa 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 BayWa is currently mispriced by the market.
-
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of BayWa? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.