Mylan Sees Profit Doubling By 2018

One of the great open secrets of investing is to listen to what companies have to say about their own projections. The hitch is that you should only pay attention to what credible companies have to say.

That’s why I took notice when Mylan ($MYL) recently said that it expects to double its earnings by 2018. That’s a bold forecast. Mylan is a generic drug maker and it has a remarkable track record. Over the last 34 years, MYL has clobbered the S&P 500 by a margin of 160,000% to 1,370%.

Mylan said its sees EPS for this year ranging between $2.30 and $2.50. That’s a growth rate of 13% to 23%. It also means the stock is going for less than 10 times earnings. For next year, Mylan sees earnings of $2.75 per share. For 2018, Mylan said that its goal is earnings of $6 per share.

Is that possible? Sure. But projecting that far out is a dangerous game. Just compare anything that was happening economically six years ago to today. Still, I’m impressed that Mylan made this forecast publicly. If it holds up, the stock should do very, very well.

Posted by on March 7th, 2012 at 10:43 am


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