U.S. Markets open in 8 hrs 54 mins

Experian plc (LON:EXPN): Will The Growth Last?

Simply Wall St

Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card!

Looking at Experian plc's ( LON:EXPN ) earnings update in September 2018, analysts seem cautiously optimistic, with earnings expected to grow by 7.0% in the upcoming year compared with the past 5-year average growth rate of 3.1%. With trailing-twelve-month net income at current levels of US$845m, we should see this rise to US$904m in 2020. Below is a brief commentary on the longer term outlook the market has for Experian. Investors wanting to learn more about other aspects of the company should research its fundamentals here .

View our latest analysis for Experian

What can we expect from Experian in the longer term?

Longer term expectations from the 14 analysts covering EXPN’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. To get an idea of the overall earnings growth trend for EXPN, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.

LSE:EXPN Past and Future Earnings, May 2nd 2019

By 2022, EXPN's earnings should reach US$1.1b, from current levels of US$845m, resulting in an annual growth rate of 9.4%. EPS reaches $1.18 in the final year of forecast compared to the current $0.92 EPS today. Margins are currently sitting at 18%, which is expected to expand to 19% by 2022.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Experian, I've compiled three relevant aspects you should further research:

  1. 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.
  2. Valuation : What is Experian 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 Experian is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Experian? 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.