Brilliance China Automotive Holdings Limited (HKG:1114): What Are The Future Prospects?

In This Article:

Want to participate in a research study? Help shape the future of investing tools and earn a $60 gift card!

Looking at Brilliance China Automotive Holdings Limited's (HKG:1114) earnings update on 31 December 2018, it seems that analyst forecasts are fairly optimistic, as a 18% increase in profits is expected in the upcoming year, compared with the past 5-year average growth rate of 4.6%. Presently, with latest-twelve-month earnings at CN¥5.8b, we should see this growing to CN¥6.9b by 2020. In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for Brilliance China Automotive Holdings in the longer term. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.

Check out our latest analysis for Brilliance China Automotive Holdings

What can we expect from Brilliance China Automotive Holdings in the longer term?

The longer term expectations from the 25 analysts of 1114 is tilted towards the positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of 1114's earnings growth over these next few years.

SEHK:1114 Past and Future Earnings, April 2nd 2019
SEHK:1114 Past and Future Earnings, April 2nd 2019

This results in an annual growth rate of 13% based on the most recent earnings level of CN¥5.8b to the final forecast of CN¥8.5b by 2022. This leads to an EPS of CN¥1.67 in the final year of projections relative to the current EPS of CN¥1.15. Margins are currently sitting at 133%, which is expected to expand to 164% by 2022.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Brilliance China Automotive Holdings, I've compiled three important aspects you should further examine:

  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. Future Earnings: How does Brilliance China Automotive Holdings's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart.

  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Brilliance China Automotive 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!

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.