Ultra Petroleum Corp. (NASDAQ:UPL): Poised For Long-Term Success?
The most recent earnings announcement Ultra Petroleum Corp.'s (NASDAQ:UPL) released in December 2018 confirmed that the company endured a significant headwind with earnings falling by -52%. Below is a brief commentary on my key takeaways on how market analysts view Ultra Petroleum's earnings growth trajectory over the next few years and whether the future looks brighter. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings.
See our latest analysis for Ultra Petroleum
Market analysts' consensus outlook for the coming year seems pessimistic, with earnings falling by a double-digit -32%. Over the medium term, earnings will begin to improve, increasing year on year, and arriving at US$105m by 2022.
Even though it’s informative knowing the growth each year relative to today’s value, it may be more valuable estimating the rate at which the company is rising or falling every year, on average. The advantage of this technique is that we can get a better picture of the direction of Ultra Petroleum'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've inserted a line of best fit through analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is 10%. This means, we can anticipate Ultra Petroleum will grow its earnings by 10% every year for the next couple of years.
Next Steps:
For Ultra Petroleum, I've put together three key factors 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.
Management:Have insiders been ramping up their shares to take advantage of the market's sentiment for UPL's future outlook? Check out our management and board analysis with insights on CEO compensation and governance factors.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of UPL? 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.
