Hypoport AG (FRA:HYQ): What Are The Future Prospects?

In March 2019, Hypoport AG (FRA:HYQ) released its earnings update. Generally, analysts seem cautiously optimistic, with earnings expected to grow by 35% in the upcoming year against the past 5-year average growth rate of 25%. Currently with trailing-twelve-month earnings of €22m, we can expect this to reach €30m by 2020. Below is a brief commentary around Hypoport’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.

Check out our latest analysis for Hypoport

Can we expect Hypoport to keep growing?

The longer term expectations from the 7 analysts of HYQ is tilted towards the positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. To understand the overall trajectory of HYQ’s earnings growth over these next fews years, I’ve fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope.

DB:HYQ Past and Future Earnings, August 5th 2019
DB:HYQ Past and Future Earnings, August 5th 2019

This results in an annual growth rate of 22% based on the most recent earnings level of €22m to the final forecast of €47m by 2022. This leads to an EPS of €6.71 in the final year of projections relative to the current EPS of €3.66. With a current profit margin of 8.4%, this movement will result in a margin of 11% by 2022.

Next Steps:

Future outlook is only one aspect when you’re building an investment case for a stock. For Hypoport, I’ve put together 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 Hypoport 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 Hypoport is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Hypoport? 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.