As Capacent Holding AB (publ) (STO:CAPAC) announced its earnings release on 31 December 2018, the consensus outlook from analysts appear fairly confident, as a 43% increase in profits is expected in the upcoming year, relative to the past 5-year average growth rate of 0.6%. Presently, with latest-twelve-month earnings at kr12m, we should see this growing to kr17m by 2020. Below is a brief commentary on the longer term outlook the market has for Capacent Holding. Investors wanting to learn more about other aspects of the company should research its fundamentals here.
How will Capacent Holding perform in the near future?
The longer term view from the 1 analysts covering CAPAC 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. To get an idea of the overall earnings growth trend for CAPAC, 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.
By 2022, CAPAC’s earnings should reach kr21m, from current levels of kr12m, resulting in an annual growth rate of 19%. This leads to an EPS of SEK7 in the final year of projections relative to the current EPS of SEK4.24. Margins are currently sitting at 4.4%, which is expected to expand to 6.4% by 2022.
Future outlook is only one aspect when you’re building an investment case for a stock. For Capacent Holding, I’ve compiled three key 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 Capacent Holding 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 Capacent Holding is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Capacent Holding? 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 firstname.lastname@example.org. 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.