Wesfarmers Ltd (ASX: WES) shares have delivered excellent growth for investors in the last 12 months, rising by approximately 30%. Investors may be wondering whether the ASX retail conglomerate can continue delivering good returns from here over the next three years.

I don't have a crystal ball to tell me the future, but we can make an educated guess about what direction Wesfarmers is headed.

The most important thing is how much profit generation the company could generate. In three years, we'll be in the middle of Wesfarmers' FY28, so let's look at the company's potential profit for both FY27 and FY28.

Projections

We are currently in the 2025 financial year, so keep in mind the forecasts I'm going to outline from UBS are not for this financial year or the next but the one after that.

Wesfarmers' profit in the next few financial years is likely to depend on Kmart Group and Bunnings, as they are the current key earnings generators. Due to their size and market share, I can't see that changing for the foreseeable future.  

Broker UBS currently projects that Wesfarmers could generate $2.65 billion of net profit after tax (NPAT) in FY25. It's useful to keep this in mind when learning how much earnings could grow by FY27.

UBS projects Wesfarmers to generate $48.8 billion in revenue, $4.8 billion in operating profit (EBIT), and $3.1 billion in net profit in FY27. This could allow the business to pay a dividend per share of $2.43.

In FY28, UBS forecasts Wesfarmers could generate $3.35 billion of net profit in the 2028 financial year, with $50.8 billion of revenue and $5.2 billion of EBIT. It could pay a dividend per share of $2.60.

Is the Wesfarmers share price appealing?

The estimates suggest the current Wesfarmers share price is valued at 26x FY28's estimated earnings. According to UBS, the retailer traded at a P/E ratio of around 26 in both FY24 and FY22, so it's possible the Wesfarmers share price may not rise much further than the current level over the next three years.

It's one thing to forecast what the profit will be, but it's much harder to guess what price/earnings (P/E) ratio the business will trade at.

However, a number of promising factors are driving Wesfarmers shares, including the strength of Kmart and Bunnings' value offerings, the international growth aspirations for the Anko brand, Wesfarmers' diversification of operations into areas like healthcare and lithium mining, and a recent decision to improve Kmart's online offering by closing loss-making Catch.

I think Wesfarmers is a great business, but I wouldn't describe it as one of the best investments on the ASX today.