How Do Analysts See O2i Société Anonyme (EPA:ALODI) Performing In The Years Ahead?

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The most recent earnings update O2i Société Anonyme's (EPA:ALODI) released in April 2019 indicated that the business experienced a major tailwind, more than doubling its earnings from the prior year. Today I want to provide a brief commentary on how market analysts predict O2i Société Anonyme's earnings growth trajectory over the next few years and whether the future looks even brighter than the past. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings.

View our latest analysis for O2i Société Anonyme

Analysts' outlook for the upcoming year seems optimistic, with earnings expanding by a significant 83%. This strong growth in earnings is expected to continue, bringing the bottom line up to €3.7m by 2022.

ENXTPA:ALODI Past and Future Earnings, July 12th 2019

Although it’s informative understanding the growth year by year relative to today’s figure, it may be more beneficial determining the rate at which the company is moving on average every year. The advantage of this approach is that it removes the impact of near term flucuations and accounts for the overarching direction of O2i Société Anonyme's earnings trajectory over time, which may be more relevant for long term investors. To calculate this rate, I put 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 31%. This means that, we can presume O2i Société Anonyme will grow its earnings by 31% every year for the next few years.

Next Steps:

For O2i Société Anonyme, I've put together three key factors 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 ALODI 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 ALODI is currently mispriced by the market.
  3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of ALODI? 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.