Looking at Columbia Sportswear Company’s (NASDAQ:COLM) earnings update in December 2018, it seems that analyst forecasts are fairly optimistic, with profits predicted to increase by 14% next year against the past 5-year average growth rate of 9.1%. By 2020, we can expect Columbia Sportswear’s bottom line to reach US$305m, a jump from the current trailing-twelve-month of US$268m. Below is a brief commentary on the longer term outlook the market has for Columbia Sportswear. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
What can we expect from Columbia Sportswear in the longer term?
The 13 analysts covering COLM view its longer term outlook with a positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. 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 11% based on the most recent earnings level of US$268m to the final forecast of US$382m by 2022. EPS reaches $5.7 in the final year of forecast compared to the current $3.85 EPS today. With a current profit margin of 9.6%, this movement will result in a margin of 11% by 2022.
Future outlook is only one aspect when you’re building an investment case for a stock. For Columbia Sportswear, I’ve put together three pertinent 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 Columbia Sportswear 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 Columbia Sportswear is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Columbia Sportswear? 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 email@example.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.