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What Do Analysts Think About Spirit AeroSystems Holdings, Inc.'s (NYSE:SPR) Earnings Trend?

Simply Wall St

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The most recent earnings announcement Spirit AeroSystems Holdings, Inc.'s (NYSE:SPR) released in December 2018 suggested that the company experienced a large tailwind, leading to a high double-digit earnings growth of 74%. Investors may find it useful to understand how market analysts perceive Spirit AeroSystems Holdings's earnings growth trajectory over the next couple of years and whether the future looks even brighter than the past. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in.

Check out our latest analysis for Spirit AeroSystems Holdings

Analysts' outlook for the coming year seems buoyant, with earnings climbing by a robust 24%. This growth seems to continue into the following year with rates arriving at double digit 34% compared to today’s earnings, and finally hitting US$875m by 2022.

NYSE:SPR Past and Future Earnings, May 1st 2019

While it’s informative knowing the growth rate year by year relative to today’s level, it may be more beneficial evaluating the rate at which the company is rising or falling every year, on average. The benefit of this technique is that it ignores near term flucuations and accounts for the overarching direction of Spirit AeroSystems Holdings's earnings trajectory over time, which may be more relevant for long term investors. To compute this rate, I've inserted a line of best fit through analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is 9.5%. This means, we can assume Spirit AeroSystems Holdings will grow its earnings by 9.5% every year for the next couple of years.

Next Steps:

For Spirit AeroSystems Holdings, I've compiled three essential factors you should further research:

  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 SPR 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 SPR is currently mispriced by the market.
  3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of SPR? 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.