The most recent earnings update Fisher & Paykel Healthcare Corporation Limited’s (NZSE:FPH) released in March 2018 confirmed Below is my commentary, albeit very simple and high-level, on how market analysts view Fisher & Paykel Healthcare’s earnings growth trajectory over the next few years and I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in.
Even though it is informative understanding the growth each year relative to today’s value, it may be more beneficial to determine the rate at which the company is growing every year, on average. The benefit of this method is that it removes the impact of near term flucuations and accounts for the overarching direction of Fisher & Paykel Healthcare’s earnings trajectory over time, which may be more relevant for long term investors. 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 12%. This means, we can anticipate Fisher & Paykel Healthcare will grow its earnings by 12% every year for the next few years.
For Fisher & Paykel Healthcare, I’ve compiled three relevant factors you should further research:
- 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 FPH 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 FPH is currently mispriced by the market.
- Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of FPH? 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.