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Cromwell Property Group (ASX:CMW): What We Can Expect From This Growth Stock

Simply Wall St

After Cromwell Property Group's (ASX:CMW) earnings announcement on 30 June 2019, it seems that analyst forecasts are fairly optimistic, with earnings expected to grow by 40% in the upcoming year relative to the past 5-year average growth rate of 1.3%. With trailing-twelve-month net income at current levels of AU$160m, we should see this rise to AU$224m in 2020. Below is a brief commentary around Cromwell Property Group's earnings outlook going forward, which may give you a sense of market sentiment for the company. For those keen to understand more about other aspects of the company, you can research its fundamentals here.

Check out our latest analysis for Cromwell Property Group

How will Cromwell Property Group perform in the near future?

The view from 4 analysts over the next three years is one of positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. To understand the overall trajectory of CMW's earnings growth over these next fews years, I've fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope.

ASX:CMW Past and Future Earnings, August 30th 2019

From the current net income level of AU$160m and the final forecast of AU$231m by 2022, the annual rate of growth for CMW’s earnings is 13%. EPS reaches A$0.088 in the final year of forecast compared to the current A$0.075 EPS today. Margins are currently sitting at 43%, which is expected to expand to 60% by 2022.

Next Steps:

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