Will accesso Technology Group plc’s (LON:ACSO) Earnings Grow Over The Next Year?

After accesso Technology Group plc’s (LON:ACSO) earnings announcement on 31 December 2018, it seems that analyst expectations are fairly bearish, with profits predicted to rise by -85% next year relative to the higher past 5-year average growth rate of 21%. Presently, with latest-twelve-month earnings at US$3.3m, we should see this growing to US$493k by 2020. Below is a brief commentary on the longer term outlook the market has for accesso Technology Group. For those keen to understand more about other aspects of the company, you can research its fundamentals here.

View our latest analysis for accesso Technology Group

Can we expect accesso Technology Group to keep growing?

The longer term expectations from the 5 analysts of ACSO 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 get an idea of the overall earnings growth trend for ACSO, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.

AIM:ACSO Past and Future Earnings, April 22nd 2019
AIM:ACSO Past and Future Earnings, April 22nd 2019

This results in an annual growth rate of 8.8% based on the most recent earnings level of US$3.3m to the final forecast of US$4.4m by 2022. This leads to an EPS of $0.16 in the final year of projections relative to the current EPS of $0.12. In 2022, ACSO’s profit margin will have expanded from 2.8% to 2.9%.

Next Steps:

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