Will Fluor Corporation’s (NYSE:FLR) Earnings Grow In The Years Ahead?
In December 2018, Fluor Corporation (NYSE:FLR) released its latest earnings announcement, which showed that the business experienced a strong tailwind, leading to a double-digit earnings growth of 17%. Below is a brief commentary on my key takeaways on how market analysts predict Fluor’s earnings growth outlook 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.
See our latest analysis for Fluor
Market analysts’ consensus outlook for this coming year seems optimistic, with earnings rising by a significant 74%. This strong growth in earnings is expected to continue, bringing the bottom line up to US$541m by 2022.
Although it is useful to understand the rate of growth each year relative to today’s figure, it may be more insightful to estimate the rate at which the company is moving on average every year. The pro of this technique is that we can get a bigger picture of the direction of Fluor’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’ve appended 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 29%. This means that, we can expect Fluor will grow its earnings by 29% every year for the next couple of years.
Next Steps:
For Fluor, I’ve put together three pertinent aspects you should look at:
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 FLR 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 FLR is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of FLR? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
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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.
