Yahoo Finance What Should We Expect From CSL Limited’s (ASX:CSL) Earnings Over The Next Year?
In June 2018, CSL Limited (ASX:CSL) announced its earnings update. Overall, the consensus outlook from analysts appear fairly confident, with earnings expected to grow by 13.5% in the upcoming year against the past 5-year average growth rate of 6.6%. Presently, with latest-twelve-month earnings at US$1.73b, we should see this growing to US$1.96b by 2019. Below is a brief commentary on the longer term outlook the market has for CSL. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
See our latest analysis for CSL
Can we expect CSL to keep growing?
Longer term expectations from the 13 analysts covering CSL’s stock is one of positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. To reduce the year-on-year volatility of analyst earnings forecast, I’ve inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.
By 2021, CSL’s earnings should reach US$2.46b, from current levels of US$1.73b, resulting in an annual growth rate of 10.0%. EPS reaches $5.43 in the final year of forecast compared to the current $3.82 EPS today. Earnings growth appears to be a result of reduction in costs rather than purely top-line expansion as earnings is increasing at a faster rate. Margins is currently sitting at 21.8%, which is expected to expand to 25.0% by 2021.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For CSL, I’ve put together three key factors you should look at:
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 CSL 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 CSL is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of CSL? 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.
