Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
The most recent earnings update Quotient Limited’s (NASDAQ:QTNT) released in March 2019 confirmed that losses became smaller relative to the prior year’s level – great news for investors Below, I’ve laid out key numbers on how market analysts view Quotient’s earnings growth trajectory over the next couple of years and whether the future looks brighter. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings.
Analysts’ expectations for this coming year seems relatively unexciting, with earnings continuing to flop around in the negative territory, reaching -US$100.6m in 2020. Furthermore, earnings should fall further in the following year, falling to -US$88.8m in 2021 and -US$30.6m in 2022.
While it’s informative understanding the rate of growth each year relative to today’s figure, it may be more valuable to analyze the rate at which the earnings are growing on average every year. The pro of this method is that we can get a better picture of the direction of Quotient’s earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To calculate this rate, I’ve inserted a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 23%. This means that, we can expect Quotient will grow its earnings by 23% every year for the next couple of years.
For Quotient, there are three fundamental factors 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.
- Future Earnings: How does QTNT’s growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart.
- Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of QTNT? 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.