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What Are Analysts Saying About Avi-Tech Electronics Limited's (SGX:BKY) Future?

Simply Wall St

On 30 June 2019, Avi-Tech Electronics Limited (SGX:BKY) announced its earnings update. Overall, it seems that analyst expectations are fairly bearish, as a 7.6% rise in profits is expected in the upcoming year, against the higher past 5-year average growth rate of 15%. Presently, with latest-twelve-month earnings at S$4.6m, we should see this growing to S$5.0m by 2020. Below is a brief commentary around Avi-Tech Electronics's earnings outlook going forward, which may give you a sense of market sentiment for the company. Investors wanting to learn more about other aspects of the company should research its fundamentals here.

View our latest analysis for Avi-Tech Electronics

Exciting times ahead?

The longer term view from the 1 analysts covering BKY is one of positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. To get an idea of the overall earnings growth trend for BKY, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.

SGX:BKY Past and Future Earnings, September 10th 2019

By 2022, BKY's earnings should reach S$5.0m, from current levels of S$4.6m, resulting in an annual growth rate of 2.2%. This leads to an EPS of SGD0.030 in the final year of projections relative to the current EPS of SGD0.027. Margins are currently sitting at 14%, which is expected to expand to 14% by 2022.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Avi-Tech Electronics, I've put together three relevant factors you should further examine:

  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 Avi-Tech Electronics 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 Avi-Tech Electronics is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Avi-Tech Electronics? 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 editorial-team@simplywallst.com. 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.