What Should You Know About Sioen Industries NV's (EBR:SIOE) Earnings Trajectory?
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Sioen Industries NV's (EBR:SIOE) most recent earnings announcement in December 2018 revealed that the business experienced a large tailwind, leading to a high double-digit earnings growth of 55%. Below is my commentary, albeit very simple and high-level, on how market analysts perceive Sioen Industries's earnings growth outlook 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 Sioen Industries
Market analysts' consensus outlook for next year seems rather subdued, with earnings increasing by a single digit 1.7%. The growth outlook in the following year seems much more positive with rates arriving at double digit 13% compared to today’s earnings, and finally hitting €41m by 2022.
Although it’s useful to be aware of the growth each year relative to today’s level, it may be more insightful analyzing the rate at which the earnings are moving on average every year. The benefit of this method is that we can get a better picture of the direction of Sioen Industries's earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To compute this rate, I've inserted a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 7.0%. This means that, we can anticipate Sioen Industries will grow its earnings by 7.0% every year for the next couple of years.
Next Steps:
For Sioen Industries, I've compiled three key factors you should further research:
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 SIOE 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 SIOE is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of SIOE? 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.
