What Should Investors Know About The Future Of Play Communications S.A.’s (WSE:PLY)?

After Play Communications S.A.’s (WSE:PLY) earnings announcement in March 2019, analysts seem cautiously optimistic, with profits predicted to increase by 8.8% next year compared with the past 5-year average growth rate of 7.2%. Presently, with latest-twelve-month earnings at zł745m, we should see this growing to zł810m by 2020. Below is a brief commentary around Play Communications’s earnings outlook going forward, which may give you a sense of market sentiment for the company. Investors wanting to learn more about other aspects of the company should research its fundamentals here.

View our latest analysis for Play Communications

What can we expect from Play Communications in the longer term?

The view from 12 analysts over the next three years is one of positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. I’ve plotted out each year’s earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of PLY’s earnings growth over these next few years.

WSE:PLY Past and Future Earnings, July 24th 2019
WSE:PLY Past and Future Earnings, July 24th 2019

By 2022, PLY’s earnings should reach zł951m, from current levels of zł745m, resulting in an annual growth rate of 8.6%. EPS reaches PLN4.12 in the final year of forecast compared to the current PLN2.93 EPS today. In 2022, PLY’s profit margin will have expanded from 11% to 13%.

Next Steps:

Future outlook is only one aspect when you’re building an investment case for a stock. For Play Communications, I’ve compiled three essential factors you should look at:

  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 Play Communications 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 Play Communications is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Play Communications? 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.