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The most recent earnings release Inwido AB’s (STO:INWI) announced in December 2018 signalled that the business benefited from a strong tailwind, eventuating to a double-digit earnings growth of 49%. Below, I’ve presented key growth figures on how market analysts view Inwido’s earnings growth outlook over the next couple of 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.
View our latest analysis for Inwido
Analysts’ expectations for this coming year seems rather muted, with earnings expanding by a single digit 1.1%. The following year doesn’t look much more exciting, though earnings does reach kr471m in 2022.
While it is helpful to be aware of the rate of growth each year relative to today’s level, it may be more beneficial analyzing the rate at which the business is growing on average every year. The benefit of this method is that we can get a better picture of the direction of Inwido’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 put a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 2.9%. This means that, we can expect Inwido will grow its earnings by 2.9% every year for the next few years.
Next Steps:
For Inwido, there are three key 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 INWI 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 INWI 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 INWI? 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.