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Based on Paradox Interactive AB (publ)'s (STO:PDX) earnings update in December 2018, analyst consensus outlook appear cautiously optimistic, with earnings growth rate expected to be 32% in the upcoming year, relative to the past five-year average earnings growth of 29% per year. Currently with trailing-twelve-month earnings of kr354m, we can expect this to reach kr468m by 2020. Below is a brief commentary on the longer term outlook the market has for Paradox Interactive. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
Check out our latest analysis for Paradox Interactive
Exciting times ahead?
The view from 2 analysts over the next three years 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 understand the overall trajectory of PDX'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.
By 2022, PDX's earnings should reach kr610m, from current levels of kr354m, resulting in an annual growth rate of 17%. EPS reaches SEK5.77 in the final year of forecast compared to the current SEK3.35 EPS today. Margins are currently sitting at 31%, approximately the same as previous years. With analysts forecasting revenue growth of 0.6866 and PDX's net income growth expected to roughly track that, this company may add value for shareholders over time.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For Paradox Interactive, I've compiled three fundamental aspects you should further research:
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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.
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Valuation: What is Paradox Interactive 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 Paradox Interactive is currently mispriced by the market.
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Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Paradox Interactive? 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.