JDcom Inc. (NASDAQ:JD): What Are The Future Prospects?
In December 2017, JDcom Inc. (NASDAQ:JD) released its most recent earnings announcement, which revealed that the business finally turned profitable after delivering losses on average over the last few years. Below, I’ve laid out key numbers on how market analysts predict JD.com’s earnings growth outlook over the next few years and whether the future looks brighter. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in. See our latest analysis for JD.com
Market analysts’ prospects for next year seems positive, with earnings growth more than doubling. Earnings continue to grow strongly in the next couple of years, finally generating CN¥12.24B in 2021.
Although it’s informative knowing the growth year by year relative to today’s level, it may be more valuable to gauge the rate at which the company is growing on average every year. The pro of this method is that it removes the impact of near term flucuations and accounts for the overarching direction of JD.com’s earnings trajectory over time, which may be more relevant for long term investors. To calculate this rate, I’ve appended 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 38.07%. This means that, we can anticipate JD.com will grow its earnings by 38.07% every year for the next few years.
Next Steps:
For JD.com, I’ve compiled three pertinent factors 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 JD 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 JD is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of JD? 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 pass 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.
