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Will BigBen Interactive's (EPA:BIG) Earnings Grow Over The Next Few Years?

Simply Wall St

BigBen Interactive's (EPA:BIG) most recent earnings announcement in June 2019 suggested that the business gained from a large tailwind, leading to a high double-digit earnings growth of 94%. Below, I've presented key growth figures on how market analysts view BigBen Interactive'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.

View our latest analysis for BigBen Interactive

Analysts' expectations for this coming year seems buoyant, with earnings increasing by a robust 18%. This growth seems to continue into the following year with rates reaching double digit 37% compared to today’s earnings, and finally hitting €29m by 2022.

ENXTPA:BIG Past and Future Earnings, August 31st 2019

While it is useful to be aware of the rate of growth each year relative to today’s figure, it may be more insightful determining the rate at which the earnings are moving on average every year. The pro of this technique is that we can get a bigger picture of the direction of BigBen Interactive's earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To compute this rate, I put 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 17%. This means that, we can anticipate BigBen Interactive will grow its earnings by 17% every year for the next couple of years.

Next Steps:

For BigBen Interactive, there are three pertinent factors you should look at:

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