After HNI Corporation's (NYSE:HNI) earnings announcement on 29 June 2019, analysts seem cautiously optimistic, with earnings expected to grow by 33% in the upcoming year relative to the past 5-year average growth rate of 4.0%. Currently with trailing-twelve-month earnings of US$93m, we can expect this to reach US$124m by 2020. I will provide a brief commentary around the figures and analyst expectations in the near term. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
How is HNI going to perform in the near future?
The longer term view from the 3 analysts covering HNI is one of positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. To understand the overall trajectory of HNI's earnings growth over these next fews years, I've fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope.
This results in an annual growth rate of 10% based on the most recent earnings level of US$93m to the final forecast of US$148m by 2022. This leads to an EPS of $3.24 in the final year of projections relative to the current EPS of $2.14. Margins are currently sitting at 4.1%, which is expected to expand to 6.0% by 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For HNI, I've compiled three relevant 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.
- Valuation: What is HNI 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 HNI is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of HNI? 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 email@example.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.