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Will Credit Corp Group Limited's (ASX:CCP) Earnings Grow In The Next 12 Months?

Simply Wall St

As Credit Corp Group Limited (ASX:CCP) released its earnings announcement on 30 June 2019, analyst consensus outlook appear cautiously subdued, with earnings expected to grow by 12% in the upcoming year relative to the higher past 5-year average growth rate of 15%. By 2020, we can expect Credit Corp Group’s bottom line to reach AU$79m, a jump from the current trailing-twelve-month of AU$70m. Below is a brief commentary around Credit Corp Group's earnings outlook going forward, which may give you a sense of market sentiment for the company. Investors wanting to learn more about other aspects of the company should research its fundamentals here.

Check out our latest analysis for Credit Corp Group

How is Credit Corp Group going to perform in the near future?

The view from 5 analysts over the next three years 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 get an idea of the overall earnings growth trend for CCP, 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.

ASX:CCP Past and Future Earnings, July 31st 2019

By 2022, CCP's earnings should reach AU$97m, from current levels of AU$70m, resulting in an annual growth rate of 11%. EPS reaches A$1.77 in the final year of forecast compared to the current A$1.42 EPS today. As revenues is expected to outpace earnings, analysts expect margins to contract from the current 26% to 23% by the end of 2022.

Next Steps:

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