Repligen Corporation (NASDAQ:RGEN): Earnings To Drop Next Year
Based on Repligen Corporation’s (NASDAQ:RGEN) earnings update in June 2018, analyst consensus outlook appear pessimistic, with profits predicted to drop by -13% next year against the past 5-year average growth rate of 9.0%. Currently with a railing-twelve-month profit of US$23m, the consensus growth rate suggests that earnings will drop to US$20m by 2019. Below is a brief commentary on the longer term outlook the market has for Repligen. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.
See our latest analysis for Repligen
Can we expect Repligen to keep growing?
Longer term expectations from the 9 analysts covering RGEN’s stock is one of positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. To understand the overall trajectory of RGEN’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.
From the current net income level of US$28m and the final forecast of US$48m by 2021, the annual rate of growth for RGEN’s earnings is 28%. This leads to an EPS of $0.89 in the final year of projections relative to the current EPS of $0.74. The bottom-line growth seems to be caused by cost-cutting initiatives, since top-line is predicted to rise at a slower pace than earnings. With a current profit margin of 20%, this movement will result in a margin of 21% by 2021.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For Repligen, I’ve put together three important aspects you should look at:
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 Repligen 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 Repligen is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Repligen? 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.
