U.S. Markets closed

What Do Analysts Think About Wingstop Inc.'s (NASDAQ:WING) Growth?

Simply Wall St

On 29 June 2019, Wingstop Inc. (NASDAQ:WING) announced its earnings update. Overall, analyst forecasts seem fairly subdued, with profits predicted to rise by 20% next year against the higher past 5-year average growth rate of 26%. Presently, with latest-twelve-month earnings at US$22m, we should see this growing to US$26m by 2020. Below is a brief commentary on the longer term outlook the market has for Wingstop. For those interested in more of an analysis of the company, you can research its fundamentals here.

Check out our latest analysis for Wingstop

Can we expect Wingstop to keep growing?

Longer term expectations from the 17 analysts covering WING’s stock is one of positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. To get an idea of the overall earnings growth trend for WING, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.

NasdaqGS:WING Past and Future Earnings, August 22nd 2019

By 2022, WING's earnings should reach US$39m, from current levels of US$22m, resulting in an annual growth rate of 20%. EPS reaches $1.22 in the final year of forecast compared to the current $0.74 EPS today. In 2022, WING's profit margin will have expanded from 14% to 17%.

Next Steps:

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