How Do Analysts See Cowell e Holdings Inc. (HKG:1415) Performing In The Next 12 Months?

Looking at Cowell e Holdings Inc.’s (HKG:1415) earnings update on 31 December 2018, analysts seem cautiously optimistic, as a 35% increase in profits is expected in the upcoming year, compared with the past 5-year average growth rate of -29%. Presently, with latest-twelve-month earnings at US$14m, we should see this growing to US$19m by 2020. I will provide a brief commentary around the figures and analyst expectations in the near term. For those interested in more of an analysis of the company, you can research its fundamentals here.

Check out our latest analysis for Cowell e Holdings

How is Cowell e Holdings going to perform in the near future?

Longer term expectations from the 2 analysts covering 1415’s stock is one of positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. I’ve plotted out each year’s earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of 1415’s earnings growth over these next few years.

SEHK:1415 Past and Future Earnings, April 24th 2019
SEHK:1415 Past and Future Earnings, April 24th 2019

By 2022, 1415’s earnings should reach US$21m, from current levels of US$14m, resulting in an annual growth rate of 11%. This leads to an EPS of $0.025 in the final year of projections relative to the current EPS of $0.017. With a current profit margin of 2.6%, this movement will result in a margin of 3.6% by 2022.

Next Steps:

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