What Should You Know About Electronic Arts Inc’s (EA) Future?
Based on the latest analyst predictions, Electronic Arts Inc (NASDAQ:EA) is estimated to sizably grow its earnings by 16.59% in the upcoming three years. With the recent EPS being $3.866, expected growth will push the upcoming EPS to $4.508. To assess the reasonability of EA’s earnings growth per share, we should look at its most recent growth rate delivered. Check out our latest analysis for Electronic Arts
What can we expect from Electronic Arts Inc (NASDAQ:EA) in the future?
EA is covered by 25 analysts who by consensus are expecting positive earnings, estimated to rise from current levels of $3.866 to $4.508 in a few years. This illustrates a relatively optimistic outlook in the near term, with a relatively solid earnings per share growth rate of 16.59% over the next few years. During the same time we will see the revenue grow from $5,084M to $6,204M and profit is predicted to escalate from $1,187M to $1,384M in the next couple of years, growing by 16.59%. Though, at the current levels of revenue and profit, margins are certainly underwhelming.
Is this similar growth to the past?
The past can be an insightful indicator for future performance for a stock. We can determine whether this level of expected growth is illustrative of future headwinds or whether the company continues to grapple with higher growth. EA delivered a significantly high triple-digit growth rate in the past couple of years, compared to the less exciting rate expected this year. This may indicate a more sustainable level of growth as the company comes off a high-growth period. Conversely, a weaker company outlook may raise the question of its ability to continue outperforming.
Next Steps:
For EA, I’ve compiled three essential aspects 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 EA 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 EA is currently mispriced by the market.
3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of EA? 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.
