What Should We Expect From Mapletree Industrial Trust’s (SGX:ME8U) Earnings In The Years Ahead?
Mapletree Industrial Trust’s (SGX:ME8U) latest earnings announcement in March 2018 showed that the company benefited from a robust tailwind, eventuating to a double-digit earnings growth of 11.07%. Below is my commentary, albeit very simple and high-level, on how market analysts view Mapletree Industrial Trust’s earnings growth trajectory over the next few 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 Mapletree Industrial Trust
Analysts’ outlook for this coming year seems pessimistic, with earnings reducing by a double-digit -17.49%. Over the medium term, earnings should continue to be below today’s level, with a decline of -10.78% in 2020, eventually reaching S$268.12M in 2021.
Even though it’s helpful to be aware of the growth year by year relative to today’s figure, it may be more beneficial to determine the rate at which the business is rising or falling on average every year. The pro of this method is that we can get a better picture of the direction of Mapletree Industrial Trust’s earnings trajectory over the long run, irrespective of near term fluctuations, be more volatile. To calculate this rate, I’ve inserted 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 -4.63%. This means, we can presume Mapletree Industrial Trust will chip away at a rate of -4.63% every year for the next couple of years.
Next Steps:
For Mapletree Industrial Trust, I’ve compiled three relevant 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 ME8U 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 ME8U is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of ME8U? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
