Blue Prism Group plc (LON:PRSM): What Does The Future Look Like?

In October 2017, Blue Prism Group plc (AIM:PRSM) released its latest earnings announcement, which revealed company earnings became less negative compared to the previous year’s level – great news for investors Below, I’ve laid out key numbers on how market analysts perceive Blue Prism Group’s earnings growth outlook over the next couple of years and whether the future looks brighter. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings. See our latest analysis for Blue Prism Group

Analysts’ outlook for the upcoming year seems pessimistic, with earnings becoming even more negative, arriving at -UK£22.87M in 2019. In the following year, earnings are expected to stay relatively stable before expanding to -UK£18.61M in 2021.

AIM:PRSM Future Profit May 31st 18
AIM:PRSM Future Profit May 31st 18

Even though it’s useful to understand the growth rate year by year relative to today’s level, it may be more beneficial to gauge the rate at which the company is moving every year, on average. The pro of this method is that we can get a bigger picture of the direction of Blue Prism Group’s earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To calculate this rate, I’ve appended a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is -18.77%. This means, we can expect Blue Prism Group will chip away at a rate of -18.77% every year for the next couple of years.

Next Steps:

For Blue Prism Group, there are three key factors you should further research:

  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. Management:Have insiders been ramping up their shares to take advantage of the market’s sentiment for PRSM’s future outlook? Check out our management and board analysis with insights on CEO compensation and governance factors.
  3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of PRSM? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!