Yahoo Finance Will Koenig & Bauer AG's (FRA:SKB) Earnings Grow Over The Next Few Years?
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Koenig & Bauer AG's (FRA:SKB) most recent earnings update in December 2018 showed that the business experienced a significant headwind with earnings deteriorating by -21%. Below is a brief commentary on my key takeaways on how market analysts view Koenig & Bauer's earnings growth trajectory over the next few years and whether the future looks brighter. 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 Koenig & Bauer
Market analysts' consensus outlook for this coming year seems pessimistic, with earnings reducing by -3.9%. But in the following year, there is a complete contrast in performance, with generating double digit 20% compared to today’s level and continues to increase to €87m in 2022.
Even though it’s informative knowing the rate of growth year by year relative to today’s value, it may be more beneficial analyzing the rate at which the business is growing on average every year. The benefit of this method is that we can get a better picture of the direction of Koenig & Bauer's earnings trajectory over the long run, irrespective of near term fluctuations, 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 that, we can anticipate Koenig & Bauer will grow its earnings by 11% every year for the next couple of years.
Next Steps:
For Koenig & Bauer, there are three essential 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 SKB 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 SKB is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of SKB? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
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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.
