Based on the latest analyst predictions, ACI Worldwide Inc (NASDAQ:ACIW) is estimated to significantly grow its earnings by 274.29% in the upcoming three years. Presently, with an EPS of $0.217, we can expect an upcoming EPS of $0.814. Today I will look at the latest data in order to investigate whether this expected growth rate is plausible. See our latest analysis for ACIW
Can we expect ACIW to keep growing?
ACI Worldwide is poised for extremely high earnings growth in the near future. Expectations from 6 analysts are extremely bullish with earnings per share estimated to more than double over the next couple of years. During the same time revenue is expected to increase from $1,032M to $1,168M and net income is predicted to shoot up from $25M to $95M in the next couple of years, more than doubling from the most recent level. However, margins look rather unappealing at the current levels of revenue and earnings.
Is this similar growth to the past?
The past can be an insightful indicator for future performance for a stock. We can determine whether this level of expected growth is excessive or whether the company continues to go from strength to strength. ACIW’s earnings growth the past couple of years was 75.60% which indicates that the company’s past performance is supportive of a strong continuation. This means ACIW has already proven its capacity to grow at an elevated rate, which should give investors higher conviction of analysts’ consensus prediction for the company’s future growth going forward.
For ACIW, I’ve put together three key 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 ACIW 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 ACIW is currently mispriced by the market.
3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of ACIW? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.