Since Capacit’e Infraprojects Limited (NSE:CAPACITE) released its earnings in March 2018, the consensus outlook from analysts appear fairly confident, with profits predicted to increase by 27% next year, though this is noticeably lower than the past 5-year average earnings growth of 46%. Currently with trailing-twelve-month earnings of ₹796m, we can expect this to reach ₹1.0b by 2019. I will provide a brief commentary around the figures and analyst expectations in the near term. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.
What can we expect from Capacit’e Infraprojects in the longer term?
The longer term view from the 4 analysts covering CAPACITE is one of positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. 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.
This results in an annual growth rate of 25% based on the most recent earnings level of ₹796m to the final forecast of ₹1.8b by 2021. EPS reaches ₹25.98 in the final year of forecast compared to the current ₹13.85 EPS today. In 2021, CAPACITE’s profit margin will have expanded from 5.9% to 6.6%.
Future outlook is only one aspect when you’re building an investment case for a stock. For Capacit’e Infraprojects, I’ve compiled three pertinent aspects 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 Capacit’e Infraprojects 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 Capacit’e Infraprojects is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Capacit’e Infraprojects? 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 firstname.lastname@example.org.