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What Are Analysts Saying About The Future Of Resurs Holding AB (publ)’s (STO:RESURS)?

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On 31 December 2018, Resurs Holding AB (publ) (STO:RESURS) announced its earnings update. Overall, analysts seem cautiously bearish, with earnings expected to grow by 14% in the upcoming year compared with the higher past 5-year average growth rate of 22%. By 2020, we can expect Resurs Holding’s bottom line to reach kr1.3b, a jump from the current trailing-twelve-month of kr1.1b. Below is a brief commentary around Resurs Holding’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 Resurs Holding

How is Resurs Holding going to perform in the near future?

Longer term expectations from the 2 analysts covering RESURS’s stock is one of positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. I’ve plotted out each year’s earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of RESURS’s earnings growth over these next few years.

OM:RESURS Past and Future Earnings, February 22nd 2019
OM:RESURS Past and Future Earnings, February 22nd 2019

By 2022, RESURS’s earnings should reach kr1.6b, from current levels of kr1.1b, resulting in an annual growth rate of 12%. This leads to an EPS of SEK8.25 in the final year of projections relative to the current EPS of SEK5.72. This high rate of growth of revenue squeezes margins, as analysts predict an upcoming margin contraction from the current 39% to 35% by the end of 2022.

Next Steps:

Future outlook is only one aspect when you’re building an investment case for a stock. For Resurs Holding, I’ve put together three essential aspects you should look at:

  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 Resurs Holding 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 Resurs Holding is currently mispriced by the market.

  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Resurs Holding? 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.

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