U.S. Markets closed

What Should We Expect From ANTA Sports Products Limited’s (HKG:2020) Earnings Over The Next Few Years?

Simply Wall St

In December 2018, ANTA Sports Products Limited (HKG:2020) announced its most recent earnings update, which confirmed that the business experienced a robust tailwind, eventuating to a double-digit earnings growth of 33%. Below is a brief commentary on my key takeaways on how market analysts predict ANTA Sports Products’s earnings growth trajectory over the next few years and whether the future looks even brighter than the past. Note that I will be looking at net income excluding extraordinary items to get a better understanding of the underlying drivers of earnings.

Check out our latest analysis for ANTA Sports Products

Market analysts’ prospects for this coming year seems buoyant, with earnings increasing by a robust 24%. This growth seems to continue into the following year with rates arriving at double digit 50% compared to today’s earnings, and finally hitting CN¥7.2b by 2022.

SEHK:2020 Past and Future Earnings, March 13th 2019

While it’s useful to be aware of the rate of growth each year relative to today’s level, it may be more beneficial to estimate the rate at which the earnings are moving on average every year. The advantage of this approach is that we can get a bigger picture of the direction of ANTA Sports Products’s earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To calculate this rate, I put a line of best fit through analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is 17%. This means that, we can expect ANTA Sports Products will grow its earnings by 17% every year for the next few years.

Next Steps:

For ANTA Sports Products, I’ve compiled three fundamental aspects 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 2020 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 2020 is currently mispriced by the market.
  3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of 2020? 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.