MannKind Corporation (NASDAQ:MNKD): Will The Growth Last?

MannKind Corporation’s (NASDAQ:MNKD) latest earnings update in December 2017 showed that the company entered the red zone with earnings dropping into the negative territory as a result of recent headwinds. Today I want to provide a brief commentary on how market analysts perceive MannKind’s earnings growth outlook over the next few years and whether the future looks brighter. Note that I will be looking at net income excluding extraordinary items to get a better understanding of the underlying drivers of earnings. View our latest analysis for MannKind

Market analysts’ consensus outlook for the coming year seems optimistic, with earnings becoming less negative, reaching -US$104.27M in 2019. In the following year, earnings are predicted to hover around the same level before rising to -US$51.41M in 2021.

NasdaqGM:MNKD Future Profit Apr 9th 18
NasdaqGM:MNKD Future Profit Apr 9th 18

While it’s useful to be aware of the growth each year relative to today’s figure, it may be more insightful analyzing the rate at which the business is growing every year, on average. The advantage of this technique is that it removes the impact of near term flucuations and accounts for the overarching direction of MannKind’s earnings trajectory over time, which may be more relevant for long term investors. 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 53.35%. This means, we can assume MannKind will grow its earnings by 53.35% every year for the next couple of years.

Next Steps:

For MannKind, I’ve put together three relevant factors you should further research:

  1. 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.
  2. Valuation: What is MNKD 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 MNKD is currently mispriced by the market.
  3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of MNKD? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!