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What Should You Know About Liberty Property Trust's (NYSE:LPT) Growth?

Looking at Liberty Property Trust's (NYSE:LPT) earnings update on 30 June 2019, it seems that analyst forecasts are fairly optimistic, with profits predicted to increase by 20% next year against the past 5-year average growth rate of 4.7%. With trailing-twelve-month net income at current levels of US$153m, we should see this rise to US$183m in 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.

View our latest analysis for Liberty Property Trust

What can we expect from Liberty Property Trust in the longer term?

The longer term expectations from the 5 analysts of LPT is tilted towards the negative sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. To get an idea of the overall earnings growth trend for LPT, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.

NYSE:LPT Past and Future Earnings, September 3rd 2019
NYSE:LPT Past and Future Earnings, September 3rd 2019

By 2022, LPT's earnings should reach US$175m, from current levels of US$153m, resulting in an annual growth rate of -0.2%. However, if we exclude extraordinary items from earnings, we see that the profits is predicted to rise over time, resulting in an EPS of $1.52 in the final year of forecast compared to the current $1.04 EPS today. The bottom-line decline seems to be caused by top-line expansion of 6.5%, which is predicted to lag cost growth leading up to 2022. However, by the end of 2022, analysts are expecting earnings to outpace revenue, and margins to expand from the current 22% to 22%.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Liberty Property Trust, there are three relevant 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 Liberty Property Trust 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 Liberty Property Trust is currently mispriced by the market.

  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Liberty Property Trust? 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.