What Are Analysts Saying About Meridian Bioscience Inc’s (NASDAQ:VIVO) Earnings Outlook?
In September 2018, Meridian Bioscience Inc (NASDAQ:VIVO) announced its most recent earnings update, which suggested that the business gained from a robust tailwind, eventuating to a double-digit earnings growth of 11%. Investors may find it useful to understand how market analysts view Meridian Bioscience’s earnings growth trajectory over the next couple of years and whether the future looks even brighter than the past. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings.
See our latest analysis for Meridian Bioscience
Market analysts’ consensus outlook for this coming year seems buoyant, with earnings rising by a robust 38%. This growth seems to continue into the following year with rates arriving at double digit 46% compared to today’s earnings, and finally hitting US$37m by 2021.
Although it is helpful to be aware of the growth rate year by year relative to today’s figure, it may be more valuable to analyze the rate at which the business is rising or falling on average every year. The pro of this approach is that we can get a better picture of the direction of Meridian Bioscience’s earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To calculate this rate, I’ve inserted a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 15%. This means, we can presume Meridian Bioscience will grow its earnings by 15% every year for the next few years.
Next Steps:
For Meridian Bioscience, I’ve compiled three pertinent aspects you should further research:
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.
Valuation: What is VIVO 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 VIVO is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of VIVO? 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 past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
