Masco Corporation (NYSE:MAS): What We Can Expect From This Growth Stock
As Masco Corporation (NYSE:MAS) announced its earnings release on 30 September 2018, it seems that analyst forecasts are fairly optimistic, with earnings expected to grow by 27% in the upcoming year relative to the past 5-year average growth rate of 6.3%. Currently with trailing-twelve-month earnings of US$614m, we can expect this to reach US$781m by 2019. Below is a brief commentary around Masco’s earnings outlook going forward, which may give you a sense of market sentiment for the company. For those interested in more of an analysis of the company, you can research its fundamentals here.
See our latest analysis for Masco
Exciting times ahead?
The view from 20 analysts over the next three years 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. To understand the overall trajectory of MAS’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.
By 2021, MAS’s earnings should reach US$813m, from current levels of US$528m, resulting in an annual growth rate of 11%. EPS reaches $3.27 in the final year of forecast compared to the current $1.68 EPS today. Earnings growth appears to be a result of cost cutting activities, as revenues is expected to grow much slower than earnings. Margins is currently sitting at 6.9%, which is expected to expand to 9.3% by 2021.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For Masco, I’ve put together three key aspects 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 Masco 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 Masco is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Masco? 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 past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
