In September 2017, Histogenics Corporation (NASDAQ:HSGX) announced its most recent earnings update, which suggested company earnings became less negative compared to the previous year’s level as a result of recent tailwinds Below, I’ve laid out key numbers on how market analysts perceive Histogenics’s earnings growth trajectory 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. View our latest analysis for Histogenics
Market analysts’ consensus outlook for the coming year seems pessimistic, with earnings becoming even more negative, generating $-22.9M in 2019. In the following year, earnings should stay relatively stable before rising to $-14.6M in 2021.
Although it’s useful to be aware of the growth each year relative to today’s level, it may be more insightful to evaluate the rate at which the business is rising or falling every year, on average. The advantage of this technique is that we can get a better picture of the direction of Histogenics’s earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To calculate this rate, I’ve appended 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 -8.95%. This means, we can assume Histogenics will chip away at a rate of -8.95% every year for the next few years.
For Histogenics, there are three important 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. Future Earnings: How does HSGX’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.
3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of HSGX? 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.