The most recent earnings update Pennsylvania Real Estate Investment Trust’s (NYSE:PEI) released in December 2018 revealed company earnings became less negative compared to the previous year’s level – great news for investors Below, I’ve presented key growth figures on how market analysts predict Pennsylvania Real Estate Investment Trust’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.
Analysts’ expectations for the coming year seems positive, with earnings becoming less negative, reaching -US$41.3m in 2020. However, this earnings level of -US$41.3m is expected to stay relatively flat over the next three years.
While it’s informative knowing the growth each year relative to today’s figure, it may be more beneficial determining the rate at which the earnings are growing every year, on average. The advantage of this technique is that it ignores near term flucuations and accounts for the overarching direction of Pennsylvania Real Estate Investment Trust’s earnings trajectory over time, which may be more relevant for long term investors. To compute this rate, I’ve inserted 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 23%. This means, we can expect Pennsylvania Real Estate Investment Trust will grow its earnings by 23% every year for the next couple of years.
For Pennsylvania Real Estate Investment Trust, I’ve put together three essential aspects 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.
- Valuation: What is PEI 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 PEI is currently mispriced by the market.
- Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of PEI? 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.