Looking at SiteOne Landscape Supply, Inc.’s (NYSE:SITE) earnings update on 30 December 2018, analyst consensus outlook appear cautiously subdued, with earnings expected to grow by 7.2% in the upcoming year relative to the higher past 5-year average growth rate of 42%. By 2020, we can expect SiteOne Landscape Supply’s bottom line to reach US$79m, a jump from the current trailing-twelve-month of US$74m. Below is a brief commentary around SiteOne Landscape Supply’s earnings outlook going forward, which may give you a sense of market sentiment for the company. For those interested in more of an analysis of the company, you can research its fundamentals here.
What can we expect from SiteOne Landscape Supply in the longer term?
Over the next three years, it seems the consensus view of the 8 analysts covering SITE is skewed 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 SITE, 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, SITE’s earnings should reach US$120m, from current levels of US$74m, resulting in an annual growth rate of 17%. EPS reaches $2.83 in the final year of forecast compared to the current $1.83 EPS today. With a current profit margin of 3.5%, this movement will result in a margin of 4.5% by 2022.
Future outlook is only one aspect when you’re building an investment case for a stock. For SiteOne Landscape Supply, there are three key aspects you should look at:
- 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 SiteOne Landscape Supply 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 SiteOne Landscape Supply is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of SiteOne Landscape Supply? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
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