Since Craneware plc (LON:CRW) released its earnings in June 2018, analyst consensus outlook appear in-line with historical trends, with earnings growth rate expected to be 13% in the upcoming year, relative to the past five-year average earnings growth of 14% per year. Presently, with latest-twelve-month earnings at US$16m, we should see this growing to US$18m by 2020. Below is a brief commentary around Craneware’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.
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Exciting times ahead?
Over the next three years, it seems the consensus view of the 5 analysts covering CRW is skewed 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 reduce the year-on-year volatility of analyst earnings forecast, I’ve inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.
By 2022, CRW’s earnings should reach US$25m, from current levels of US$16m, resulting in an annual growth rate of 14%. This leads to an EPS of $0.90 in the final year of projections relative to the current EPS of $0.59. Margins are currently sitting at 24%, approximately the same as previous years. With analysts forecasting revenue growth of 0.59778 and CRW’s net income growth expected to roughly track that, this company may add value for shareholders over time.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For Craneware, I’ve compiled three pertinent factors you should look at:
- 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.
- Valuation: What is Craneware 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 Craneware is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Craneware? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.