The most recent earnings release Liberty Gold Corp.'s (TSE:LGD) announced in December 2018 signalled that losses became smaller relative to the prior year's level - great news for investors Today I want to provide a brief commentary on how market analysts view Liberty Gold's earnings growth trajectory over the next few years and whether the future looks brighter. Note that I will be looking at net income excluding extraordinary items to get a better understanding of the underlying drivers of earnings.
Analysts' expectations for next year seems buoyant, with earnings becoming less negative, reaching -US$10.0m in 2020. In the following year, earnings are expected to remain stable before increasing to -US$16.0m in 2022.
Although it is informative knowing the rate of growth each year relative to today’s value, it may be more insightful to analyze the rate at which the business is growing on average every year. The pro of this method is that we can get a better picture of the direction of Liberty Gold's earnings trajectory over the long run, irrespective of near term fluctuations, be more volatile. To compute this rate, I put 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 -9.5%. This means, we can assume Liberty Gold will chip away at a rate of -9.5% every year for the next few years.
For Liberty Gold, I've put together three pertinent factors 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.
- Future Earnings: How does LGD's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart.
- Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of LGD? 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.