How might earnings at BHP Billiton (LSE: BLT) change in the years to come?
It's always worth keeping an eye on the earnings forecasts for your favourite companies, especially if you use forward P/E ratios to gauge when to buy and sell your shares.
You never know, if City brokers have been revising their projections of late, your investments may not be as cheap -- or expensive -- as you think!
Today I'm looking at the earnings per share (EPS) forecasts for BHP Billiton (LSE: BLT) (NYSE: BBL.US), the FTSE 100 (UKX) diversified miner. All my figures are courtesy of S&P Capital IQ.
The consensus for 2013 is for earnings per share of 170p, which puts the 1,926p shares on a forward P/E of 11.
The estimates suggest earnings may rise to 196p per share for 2014 and climb to 202p for 2015. Earnings per share may then rise further to 206p for 2016 before falling back to 198p in 2017, at least according to City analysts.
The data from S&P Capital IQ also indicates BHP Billiton's revenues may rise from £43 billion in 2013 to £48 billion the following year before climbing to £52 billion the year after.
Apart from rising revenues, the forecasts for BHP aren't great -- profits are essentially predicted to go nowhere between 2014 and 2016. But then again, that P/E of around 11 looks like the market is already expecting earnings won't advance anytime soon.
Whether these projections make BHP Billiton a buy, a hold or a sell is of course up to you. To put the company's multiple into perspective, the FTSE 100 at 5,755 trades on a P/E of 11.4.
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> David does not own shares in BHP Billiton.