Yahoo Finance What Should We Expect From Experian plc’s (LON:EXPN) Earnings Over The Next Few Years?
The most recent earnings release Experian plc’s (LSE:EXPN) announced in March 2018 indicated that the business gained from a small tailwind, leading to a single-digit earnings growth of 3.94%. Below, I’ve laid out key numbers on how market analysts perceive Experian’s earnings growth outlook over the next couple of 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. See our latest analysis for Experian
Analysts’ outlook for next year seems pessimistic, with earnings reducing by -0.89%. But in the following year, there is a complete contrast in performance, with generating double digit 9.34% compared to today’s level and continues to increase to US$1.05B in 2021.
While it’s useful to be aware of the rate of growth year by year relative to today’s level, it may be more insightful to analyze the rate at which the company is growing every year, on average. The benefit of this technique is that we can get a better picture of the direction of Experian’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 appended 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 6.24%. This means that, we can presume Experian will grow its earnings by 6.24% every year for the next few years.
Next Steps:
For Experian, there are three relevant 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 EXPN 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 EXPN is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of EXPN? 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 pass 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.
