What Are Analysts Saying About ITC Limited's (NSE:ITC) Growth?
Since ITC Limited (NSE:ITC) released its earnings in March 2019, analyst consensus outlook appear cautiously optimistic, as a 9.2% increase in profits is expected in the upcoming year, against the past 5-year average growth rate of 6.7%. With trailing-twelve-month net income at current levels of ₹126b, we should see this rise to ₹137b in 2020. Below is a brief commentary around ITC's earnings outlook going forward, which may give you a sense of market sentiment for the company. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.
Check out our latest analysis for ITC
Exciting times ahead?
The 18 analysts covering ITC view its longer term outlook with a positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. To understand the overall trajectory of ITC'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.
This results in an annual growth rate of 10% based on the most recent earnings level of ₹126b to the final forecast of ₹174b by 2022. EPS reaches ₹14.31 in the final year of forecast compared to the current ₹10.3 EPS today. With a current profit margin of 26%, this movement will result in a margin of 29% by 2022.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For ITC, I've compiled three essential factors you should look at:
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 ITC 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 ITC is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of ITC? 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.
