Yahoo Finance What Do Investors Need To Know About IG Group Holdings plc's (LON:IGG) Future?
On 31 May 2019, IG Group Holdings plc (LON:IGG) released its most recent earnings update. Generally, analyst forecasts seem bearish, with profits predicted to drop by 7.8% next year compared with the past 5-year average growth rate of 8.5%. Presently, with latest-twelve-month earnings at UK£158m, we should see this fall to UK£146m by 2020. In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for IG Group Holdings in the longer term. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
See our latest analysis for IG Group Holdings
Can we expect IG Group Holdings to keep growing?
Longer term expectations from the 6 analysts covering IGG’s stock is one of positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of IGG's earnings growth over these next few years.
This results in an annual growth rate of 6.6% based on the most recent earnings level of UK£158m to the final forecast of UK£187m by 2022. EPS reaches £0.52 in the final year of forecast compared to the current £0.43 EPS today. Margins are currently sitting at 32%, approximately the same as previous years. With analysts forecasting revenue growth of 0.19496 and IGG's net income growth expected to roughly track that, this company may add value for shareholders over time.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For IG Group Holdings, there are three fundamental aspects 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 IG Group Holdings 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 IG Group Holdings is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of IG Group Holdings? 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.
