Will Chongqing Rural Commercial Bank Co., Ltd.'s (HKG:3618) Earnings Grow Over The Next Year?
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In December 2018, Chongqing Rural Commercial Bank Co., Ltd. (HKG:3618) announced its earnings update. Overall, analyst consensus outlook appear cautiously subdued, with profits predicted to rise by 5.4% next year relative to the higher past 5-year average growth rate of 8.5%. By 2020, we can expect Chongqing Rural Commercial Bank’s bottom line to reach CN¥9.5b, a jump from the current trailing-twelve-month of CN¥9.1b. Below is a brief commentary around Chongqing Rural Commercial Bank's earnings outlook going forward, which may give you a sense of market sentiment for the company. For those interested in more of an analysis of the company, you can research its fundamentals here.
View our latest analysis for Chongqing Rural Commercial Bank
How is Chongqing Rural Commercial Bank going to perform in the near future?
The view from 13 analysts over the next three years is one of positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. To reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.
This results in an annual growth rate of 6.9% based on the most recent earnings level of CN¥9.1b to the final forecast of CN¥11b by 2022. EPS reaches CN¥1.1 in the final year of forecast compared to the current CN¥0.91 EPS today. This high rate of growth of revenue squeezes margins, as analysts predict an upcoming margin contraction from the current 45% to 35% by the end of 2022.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For Chongqing Rural Commercial Bank, I've put together three pertinent aspects 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.
Valuation: What is Chongqing Rural Commercial Bank 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 Chongqing Rural Commercial Bank is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Chongqing Rural Commercial Bank? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
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