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Logan Property Holdings Company Limited (HKG:3380): Poised For Long Term Success?

Simply Wall St

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Looking at Logan Property Holdings Company Limited's (HKG:3380) earnings update in December 2018, analysts seem fairly confident, with profits predicted to increase by 20% next year, though this is relatively lower than the historical 5-year average earnings growth of 29%. With trailing-twelve-month net income at current levels of CN¥8.1b, we should see this rise to CN¥9.8b in 2020. Below is a brief commentary on the longer term outlook the market has for Logan Property Holdings. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.

Check out our latest analysis for Logan Property Holdings

How is Logan Property Holdings going to perform in the near future?

Longer term expectations from the 15 analysts covering 3380’s stock is one of positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of 3380's earnings growth over these next few years.

SEHK:3380 Past and Future Earnings, June 5th 2019

By 2022, 3380's earnings should reach CN¥15b, from current levels of CN¥8.1b, resulting in an annual growth rate of 22%. EPS reaches CN¥2.76 in the final year of forecast compared to the current CN¥1.48 EPS today. This high rate of growth of revenue squeezes margins, as analysts predict an upcoming margin contraction from the current 18% to 15% by the end of 2022.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Logan Property Holdings, I've put together three key aspects you should further examine:

  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 Logan Property Holdings'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 Logan Property Holdings? 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.