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In March 2019, Four Corners Property Trust, Inc. (NYSE:FCPT) released its earnings update. Generally, analyst forecasts appear to be bearish, with profits predicted to drop by 10% next year compared with the past 5-year average growth rate of 28%. Currently with a trailing-twelve-month profit of US$82m, the consensus growth rate suggests that earnings will drop to US$74m by 2020. Below is a brief commentary on the longer term outlook the market has for Four Corners Property Trust. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
Exciting times ahead?
Over the next three years, it seems the consensus view of the 3 analysts covering FCPT is skewed towards the positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. To get an idea of the overall earnings growth trend for FCPT, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.
This results in an annual growth rate of 7.6% based on the most recent earnings level of US$82m to the final forecast of US$90m by 2022. However, if we exclude extraordinary items from net income, we see that earnings is projected to fall over time, resulting in an EPS of $1.17 in the final year of forecast compared to the current $1.29 EPS today. Analysts are predicting this high revenue growth to squeeze profit margins over time, from 57% to 44% by the end of 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For Four Corners Property Trust, I've put together three essential 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 Four Corners Property Trust 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 Four Corners Property Trust is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Four Corners Property Trust? 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 firstname.lastname@example.org. 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.