Can we expect athenahealth to keep growing?The 24 analysts covering ATHN 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 understand the overall trajectory of ATHN’s earnings growth over these next fews years, I’ve fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope. This results in an annual growth rate of 18.61% based on the most recent earnings level of US$53.10m to the final forecast of US$90.16m by 2021. EPS reaches $3.57 in the final year of forecast compared to the current $1.33 EPS today. Earnings growth appears to be a result of cost-cutting initiatives, since top-line is predicted to rise at a slower pace than earnings. With a current profit margin of 4.35%, this movement will result in a margin of 5.63% by 2021.
Future outlook is only one aspect when you’re building an investment case for a stock. For athenahealth, I’ve compiled three fundamental 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 athenahealth 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 athenahealth is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of athenahealth? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!