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Since Abraxas Petroleum Corporation (NASDAQ:AXAS) released its earnings in March 2019, analyst forecasts seem bearish, with profits predicted to drop by 3.2% next year. Though compared to its 5-year track record of the average earnings growth rate of -5.7%, this is still an improvement. Currently with a trailing-twelve-month profit of US$58m, the consensus growth rate suggests that earnings will drop to US$56m by 2020. Below is a brief commentary on the longer term outlook the market has for Abraxas Petroleum. For those interested in more of an analysis of the company, you can research its fundamentals here.
Can we expect Abraxas Petroleum to keep growing?
The view from 6 analysts over the next three years is one of positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. To reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.
By 2022, AXAS's earnings should reach US$251m, from current levels of US$58m, resulting in an annual growth rate of 36%. EPS reaches $0.45 in the final year of forecast compared to the current $0.35 EPS today. Margins are currently sitting at 39%, which is expected to expand to 102% by 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For Abraxas Petroleum, I've put together three important 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.
- Future Earnings: How does Abraxas Petroleum'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 Abraxas Petroleum? 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.