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What Do Analysts Think About Lindsay Australia Limited's (ASX:LAU) Future?

Simply Wall St

Looking at Lindsay Australia Limited's (ASX:LAU) earnings update on 30 June 2019, analyst consensus outlook appear cautiously optimistic, as a 7.9% increase in profits is expected in the upcoming year, compared with the past 5-year average growth rate of 5.2%. Currently with trailing-twelve-month earnings of AU$8.9m, we can expect this to reach AU$9.6m by 2020. Below is a brief commentary around Lindsay Australia's earnings outlook going forward, which may give you a sense of market sentiment for the company. For those keen to understand more about other aspects of the company, you can research its fundamentals here.

See our latest analysis for Lindsay Australia

What can we expect from Lindsay Australia in the longer term?

The longer term view from the 2 analysts covering LAU 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. To reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.

ASX:LAU Past and Future Earnings, September 6th 2019

By 2022, LAU's earnings should reach AU$11m, from current levels of AU$8.9m, resulting in an annual growth rate of 7.6%. EPS reaches A$0.038 in the final year of forecast compared to the current A$0.030 EPS today. With a current profit margin of 2.3%, this movement will result in a margin of 2.6% by 2022.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Lindsay Australia, there are three pertinent 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 Lindsay Australia 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 Lindsay Australia is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Lindsay Australia? 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.