What Should You Know About FLIR Systems, Inc.’s (NASDAQ:FLIR) Future?
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FLIR Systems, Inc.’s (NASDAQ:FLIR) latest earnings update in December 2018 confirmed that the company experienced a substantial tailwind, more than doubling its earnings from the prior year. Below, I’ve laid out key numbers on how market analysts view FLIR Systems’s earnings growth outlook over the next few years and whether the future looks even brighter than the past. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in.
View our latest analysis for FLIR Systems
Analysts’ outlook for the coming year seems rather subdued, with earnings rising by a single digit 3.9%. The growth outlook in the following year seems much more buoyant with rates reaching double digit 18% compared to today’s earnings, and finally hitting US$369m by 2022.
Even though it is informative knowing the growth rate each year relative to today’s level, it may be more insightful evaluating the rate at which the earnings are rising or falling on average every year. The benefit of this technique is that it removes the impact of near term flucuations and accounts for the overarching direction of FLIR Systems’s earnings trajectory over time, which may be more relevant for long term investors. To calculate this rate, I put a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 8.5%. This means that, we can expect FLIR Systems will grow its earnings by 8.5% every year for the next couple of years.
Next Steps:
For FLIR Systems, there are three important 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 FLIR 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 FLIR is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of FLIR? 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.
