Looking at Clipper Logistics plc's (LON:CLG) earnings update on 30 April 2019, analysts seem extremely confident, with profits predicted to ramp up by an impressive 56% next year, against the past 5-year average growth rate of 19%. By 2020, we can expect Clipper Logistics’s bottom line to reach UK£21m, a jump from the current trailing-twelve-month of UK£13m. In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for Clipper Logistics in the longer term. For those interested in more of an analysis of the company, you can research its fundamentals here.
What can we expect from Clipper Logistics in the longer term?
Longer term expectations from the 3 analysts covering CLG’s stock 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.
By 2022, CLG's earnings should reach UK£27m, from current levels of UK£13m, resulting in an annual growth rate of 20%. EPS reaches £0.26 in the final year of forecast compared to the current £0.13 EPS today. Margins are currently sitting at 2.9%, which is expected to expand to 4.3% by 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For Clipper Logistics, I've compiled three important aspects 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 Clipper Logistics 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 Clipper Logistics is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Clipper Logistics? 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.