U.S. Markets closed

What Are Analysts Saying About Floor & Decor Holdings, Inc.'s (NYSE:FND) Future?

Simply Wall St

Want to participate in a research study? Help shape the future of investing tools and earn a $60 gift card!

In December 2018, Floor & Decor Holdings, Inc. (NYSE:FND) released its earnings update. Generally, analyst forecasts seem bearish, as a -4.3% fall in profits is expected in the upcoming year relative to the past 5-year average growth rate of 45%. Presently, with latest-twelve-month earnings at US$116m, we should see this fall to US$111m by 2020. I will provide a brief commentary around the figures and analyst expectations in the near term. For those interested in more of an analysis of the company, you can research its fundamentals here.

View our latest analysis for Floor & Decor Holdings

How will Floor & Decor Holdings perform in the near future?

Over the next three years, it seems the consensus view of the 18 analysts covering FND is skewed towards the positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. To understand the overall trajectory of FND's earnings growth over these next fews years, I've fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope.

NYSE:FND Past and Future Earnings, April 2nd 2019

By 2022, FND's earnings should reach US$174m, from current levels of US$116m, resulting in an annual growth rate of 15%. This leads to an EPS of $1.67 in the final year of projections relative to the current EPS of $1.2. This high rate of growth of revenue squeezes margins, as analysts predict an upcoming margin contraction from the current 6.8% to 5.8% by the end of 2022.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Floor & Decor Holdings, I've compiled three fundamental aspects 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 Floor & Decor Holdings 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 Floor & Decor Holdings is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Floor & Decor Holdings? 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.