Analysts’ outlook for this coming year seems relatively unexciting, with earnings continuing to flop around in the negative territory, generating -US$77.38M in 2019. In addition, earnings are expected to fall further in the following year, before bouncing back up again to -US$80.33M in 2021.
While it is helpful to understand the rate of growth each year relative to today’s figure, it may be more insightful estimating the rate at which the company is growing every year, on average. The benefit of this technique is that we can get a better picture of the direction of Merrimack Pharmaceuticals’s earnings trajectory over the long run, irrespective of near term fluctuations, fluctuate up and down. To calculate this rate, I put a line of best fit through analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is -0.83%. This means, we can assume Merrimack Pharmaceuticals will chip away at a rate of -0.83% every year for the next few years.
For Merrimack Pharmaceuticals, I’ve compiled three pertinent factors 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.
- Future Earnings: How does MACK’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 MACK? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!