U.S. Markets closed

Fluidigm Corporation (NASDAQ:FLDM): Is It A Good Long Term Opportunity?

Sam Bishop

Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!

In December 2018, Fluidigm Corporation (NASDAQ:FLDM) announced its most recent earnings update, which revealed company earnings became less negative compared to the previous year’s level as a result of recent tailwinds Today I want to provide a brief commentary on how market analysts view Fluidigm’s earnings growth outlook over the next few years and whether the future looks brighter. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings.

See our latest analysis for Fluidigm

Analysts’ expectations for next year seems relatively muted, with earnings continuing to flop around in the negative territory, generating -US$57.2m in 2020. Moreover, earnings are predicted to fall further in the following year, declining to -US$47.4m in 2021 and -US$32.3m in 2022.

NASDAQGS:FLDM Future Profit February 12th 19

Even though it is helpful to understand the growth year by year relative to today’s figure, it may be more valuable to evaluate the rate at which the company is moving on average every year. The advantage of this approach is that it ignores near term flucuations and accounts for the overarching direction of Fluidigm’s earnings trajectory over time, which may be more relevant for long term investors. To compute this rate, I’ve inserted 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 21%. This means, we can anticipate Fluidigm will grow its earnings by 21% every year for the next few years.

Next Steps:

For Fluidigm, I’ve put together three fundamental 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 FLDM 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 FLDM is currently mispriced by the market.
  3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of FLDM? 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 past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.