Looking at PWR Holdings Limited's (ASX:PWH) earnings update on 30 June 2019, the consensus outlook from analysts appear fairly confident, with earnings expected to grow by 18% in the upcoming year against the past 5-year average growth rate of 15%. Presently, with latest-twelve-month earnings at AU$14m, we should see this growing to AU$17m by 2020. Below is a brief commentary on the longer term outlook the market has for PWR Holdings. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
How will PWR Holdings perform in the near future?
The 2 analysts covering PWH view its longer term outlook with a positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. 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 PWH's earnings growth over these next few years.
By 2022, PWH's earnings should reach AU$23m, from current levels of AU$14m, resulting in an annual growth rate of 16%. EPS reaches A$0.23 in the final year of forecast compared to the current A$0.14 EPS today. Margins are currently sitting at 22%, approximately the same as previous years. With analysts forecasting revenue growth of 0.56345 and PWH's net income growth expected to roughly track that, this company may add value for shareholders over time.
Future outlook is only one aspect when you're building an investment case for a stock. For PWR Holdings, I've compiled three fundamental factors you should further examine:
- 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 PWR 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 PWR Holdings is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of PWR 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 firstname.lastname@example.org. 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.