Merus NV (NASDAQ:MRUS): Should The Future Outlook Worry You?
The most recent earnings announcement Merus NV’s (NASDAQ:MRUS) released in September 2017 suggested that losses became smaller relative to the prrior year’s level as a result of recent tailwinds Below, I’ve laid out key growth figures on how market analysts perceive Merus’s earnings growth outlook over the next couple of years and whether the future looks brighter. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in. View our latest analysis for Merus
Analysts’ outlook for the upcoming year seems pessimistic, with earnings becoming even more negative, generating €-69.2M in 2018. Furthermore, earnings should fall off in the following year, reducing to €-88.5M in 2019 and €-101.8M in 2020.
While it’s useful to be aware of the growth year by year relative to today’s figure, it may be more insightful to determine the rate at which the company is rising or falling every year, on average. The pro of this method is that it ignores near term flucuations and accounts for the overarching direction of Merus’s earnings trajectory over time, fluctuate up and down. To calculate this rate, I’ve inserted a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is -1.47%. This means that, we can assume Merus will chip away at a rate of -1.47% every year for the next couple of years.
Next Steps:
For Merus, I’ve put together 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. Management:Have insiders been ramping up their shares to take advantage of the market’s sentiment for MRUS’s future outlook? Check out our management and board analysis with insights on CEO compensation and governance factors.
3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of MRUS? 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 pass 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.
