Lonking Holdings Limited's (HKG:3339) most recent earnings announcement in April 2019 signalled that the company experienced a small tailwind, leading to a single-digit earnings growth of 9.4%. Below, I've laid out key growth figures on how market analysts perceive Lonking Holdings'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.
Market analysts' consensus outlook for this coming year seems optimistic, with earnings climbing by a robust 19%. This growth seems to continue into the following year with rates reaching double digit 24% compared to today’s earnings, and finally hitting CN¥1.4b by 2022.
While it’s helpful to be aware of the growth year by year relative to today’s value, it may be more beneficial to gauge the rate at which the business is rising or falling every year, on average. The advantage of this method is that we can get a better picture of the direction of Lonking Holdings's earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To compute this rate, I've appended a line of best fit through analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is 7.0%. This means, we can anticipate Lonking Holdings will grow its earnings by 7.0% every year for the next couple of years.
For Lonking Holdings, I've compiled 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 3339 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 3339 is currently mispriced by the market.
- Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of 3339? 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.