Times China Holdings Limited (HKG:1233): What Does The Future Look Like?
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In December 2018, Times China Holdings Limited (HKG:1233) announced its earnings update. Overall, analyst forecasts seem fairly subdued, with profits predicted to rise by 18% next year compared with the higher past 5-year average growth rate of 28%. Presently, with latest-twelve-month earnings at CN¥4.4b, we should see this growing to CN¥5.2b by 2020. I will provide a brief commentary around the figures and analyst expectations in the near term. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
View our latest analysis for Times China Holdings
What can we expect from Times China Holdings in the longer term?
Longer term expectations from the 9 analysts covering 1233’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. To get an idea of the overall earnings growth trend for 1233, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.
This results in an annual growth rate of 19% based on the most recent earnings level of CN¥4.4b to the final forecast of CN¥7.8b by 2022. This leads to an EPS of CN¥4.17 in the final year of projections relative to the current EPS of CN¥2.4. Analysts are predicting this high revenue growth to squeeze profit margins over time, from 13% to 12% by the end of 2022.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For Times China Holdings, there are three relevant 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 Times China Holdings 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 Times China Holdings is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Times China 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!
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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.
