Money3 Corporation Limited (ASX:MNY): Immense Growth Potential?
The most recent earnings update Money3 Corporation Limited's (ASX:MNY) released in August 2019 suggested that the company experienced a robust tailwind, leading to a double-digit earnings growth of 14%. Below, I've laid out key growth figures on how market analysts predict Money3's earnings growth trajectory over the next couple of 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.
Check out our latest analysis for Money3
Analysts' expectations for the upcoming year seems optimistic, with earnings expanding by a robust 32%. This growth seems to continue into the following year with rates reaching double digit 63% compared to today’s earnings, and finally hitting AU$44m by 2022.
While it’s helpful to understand the rate of growth year by year relative to today’s level, it may be more valuable analyzing the rate at which the earnings are moving on average every year. The benefit of this method is that we can get a better picture of the direction of Money3'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 put 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 19%. This means that, we can assume Money3 will grow its earnings by 19% every year for the next few years.
Next Steps:
For Money3, I've compiled three important aspects you should further research:
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 MNY 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 MNY is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of MNY? 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.
