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Tritax Big Box REIT plc’s (LON:BBOX) most recent earnings announcement in December 2018 confirmed that the business gained from a slight tailwind, eventuating to a single-digit earnings growth of 1.9%. Investors may find it useful to understand how market analysts predict Tritax Big Box REIT’s earnings growth trajectory over the next few years and whether the future looks even brighter than the past. Note that I will be looking at net income excluding extraordinary items to get a better understanding of the underlying drivers of earnings.
Market analysts’ consensus outlook for this coming year seems rather muted, with earnings climbing by a single digit 6.4%. However, the following year seems to show a contrast, with earnings declining by -7.4%. This volatility continues into the final year of forecast, with earnings generating UK£227m.
While it’s informative knowing the growth year by year relative to today’s level, it may be more insightful evaluating the rate at which the company is growing on average every year. The benefit of this technique is that we can get a bigger picture of the direction of Tritax Big Box REIT’s earnings trajectory over the long run, irrespective of near term fluctuations, fluctuate up and down. To calculate this rate, I’ve inserted a line of best fit through analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is -4.8%. This means, we can presume Tritax Big Box REIT will chip away at a rate of -4.8% every year for the next few years.
For Tritax Big Box REIT, there are three key factors you should further examine:
- 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 BBOX 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 BBOX is currently mispriced by the market.
- Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of BBOX? 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 firstname.lastname@example.org. 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.