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What Should Investors Know About The Future Of Ascendas Real Estate Investment Trust's (SGX:A17U)?

Simply Wall St

After Ascendas Real Estate Investment Trust's (SGX:A17U) earnings announcement in March 2019, analysts seem fairly confident, as a 5.0% increase in profits is expected in the upcoming year, compared with the past 5-year average growth rate of 1.9%. By 2020, we can expect Ascendas Real Estate Investment Trust’s bottom line to reach S$513m, a jump from the current trailing-twelve-month of S$489m. Below is a brief commentary around Ascendas Real Estate Investment Trust's earnings outlook going forward, which may give you a sense of market sentiment for the company. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.

Check out our latest analysis for Ascendas Real Estate Investment Trust

How is Ascendas Real Estate Investment Trust going to perform in the near future?

The longer term view from the 17 analysts covering A17U is one of positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of A17U's earnings growth over these next few years.

SGX:A17U Past and Future Earnings, July 29th 2019

This results in an annual growth rate of 4.5% based on the most recent earnings level of S$489m to the final forecast of S$561m by 2022. EPS reaches SGD0.18 in the final year of forecast compared to the current SGD0.16 EPS today. Margins are currently sitting at 55%, which is expected to expand to 56% by 2022.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Ascendas Real Estate Investment Trust, I've compiled three pertinent factors 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 Ascendas Real Estate Investment 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 Ascendas Real Estate Investment Trust is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Ascendas Real Estate Investment 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 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.