The most recent earnings announcement China National Building Material Company Limited's (HKG:3323) released in December 2018 showed that the company benefited from a strong tailwind, leading to a high double-digit earnings growth of 63%. Below is a brief commentary on my key takeaways on how market analysts view China National Building Material's earnings growth outlook over the next few 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.

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Market analysts' consensus outlook for this coming year seems rather muted, with earnings increasing by a single digit 8.1%. The following years do not look much more exciting, with earnings reaching CN¥8.4b before falling in 2022.

Although it’s useful to be aware of the rate of growth each year relative to today’s level, it may be more insightful determining the rate at which the company is rising or falling every year, on average. The benefit of this method is that it ignores near term flucuations and accounts for the overarching direction of China National Building Material's earnings trajectory over time, fluctuate up and down. To calculate this rate, I've appended 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 -0.3%. This means, we can expect China National Building Material will chip away at a rate of -0.3% every year for the next couple of years.

Next Steps:

For China National Building Material, I've put together three important aspects you should look at:

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. Valuation: What is 3323 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 3323 is currently mispriced by the market.

3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of 3323? 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.