Eni S.p.A. (BIT:ENI): Immense Growth Potential?

Simply Wall St

On 31 March 2019, Eni S.p.A. (BIT:ENI) released its earnings update. Generally, analyst forecasts seem fairly subdued, as a 12% rise in profits is expected in the upcoming year, against the higher past 5-year average growth rate of 18%. Presently, with latest-twelve-month earnings at €4.1b, we should see this growing to €4.6b by 2020. Below is a brief commentary around Eni's earnings outlook going forward, which may give you a sense of market sentiment for the company. Investors wanting to learn more about other aspects of the company should research its fundamentals here.

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Check out our latest analysis for Eni

How will Eni perform in the near future?

The longer term view from the 23 analysts covering ENI is one of positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. To understand the overall trajectory of ENI'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.

BIT:ENI Past and Future Earnings, May 16th 2019

By 2022, ENI's earnings should reach €5.5b, from current levels of €4.1b, resulting in an annual growth rate of 11%. EPS reaches €1.73 in the final year of forecast compared to the current €1.15 EPS today. In 2022, ENI's profit margin will have expanded from 5.4% to 6.5%.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Eni, I've put together three fundamental 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 Eni 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 Eni is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Eni? 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.