After La-Z-Boy Incorporated’s (NYSE:LZB) earnings announcement in January 2019, analysts seem cautiously bearish, as a 0.9% rise in profits is expected in the upcoming year, compared with the higher past 5-year average growth rate of 8.5%. By 2020, we can expect La-Z-Boy’s bottom line to reach US$81m, a jump from the current trailing-twelve-month of US$80m. I will provide a brief commentary around the figures and analyst expectations in the near term. Investors wanting to learn more about other aspects of the company should research its fundamentals here.
See our latest analysis for La-Z-Boy
How will La-Z-Boy perform in the near future?
Longer term expectations from the 4 analysts covering LZB’s stock 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 get an idea of the overall earnings growth trend for LZB, 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.
This results in an annual growth rate of 11% based on the most recent earnings level of US$80m to the final forecast of US$104m by 2022. EPS reaches $2.84 in the final year of forecast compared to the current $1.69 EPS today. In 2022, LZB’s profit margin will have expanded from 5.1% to 5.6%.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For La-Z-Boy, I’ve compiled three fundamental 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 La-Z-Boy 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 La-Z-Boy is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of La-Z-Boy? 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 editorial-team@simplywallst.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.