Yahoo Finance How Do Analysts See Britvic plc (LON:BVIC) Performing In The Next Couple Of Years?
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In September 2018, Britvic plc (LON:BVIC) announced its latest earnings update, which indicated that the company benefited from a small tailwind, eventuating to a single-digit earnings growth of 4.9%. Today I want to provide a brief commentary on how market analysts predict Britvic’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 Britvic
Analysts’ expectations for next year seems optimistic, with earnings rising by a robust 20%. This growth seems to continue into the following year with rates arriving at double digit 36% compared to today’s earnings, and finally hitting UK£169m by 2022.
While it is helpful to understand the growth year by year relative to today’s figure, it may be more beneficial estimating the rate at which the company is moving on average every year. The advantage of this method is that it removes the impact of near term flucuations and accounts for the overarching direction of Britvic’s earnings trajectory over time, which may be more relevant for long term investors. To calculate 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 11%. This means, we can assume Britvic will grow its earnings by 11% every year for the next couple of years.
Next Steps:
For Britvic, there are three pertinent aspects 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 BVIC 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 BVIC is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of BVIC? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
