In This Article:
As CLX Communications AB (publ) (STO:SINCH) released its earnings announcement on 31 December 2018, analysts seem cautiously optimistic, with earnings expected to grow by 21% in the upcoming year, though this is noticeably lower than the previous 5-year average earnings growth of 36%. Presently, with latest-twelve-month earnings at kr180m, we should see this growing to kr217m by 2020. In this article, I’ve outline a few earnings growth rates to give you a sense of the market sentiment for CLX Communications in the longer term. Investors wanting to learn more about other aspects of the company should research its fundamentals here.
See our latest analysis for CLX Communications
Can we expect CLX Communications to keep growing?
The view from 2 analysts over the next three years is one of positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. To understand the overall trajectory of SINCH’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.
From the current net income level of kr180m and the final forecast of kr327m by 2022, the annual rate of growth for SINCH’s earnings is 20%. EPS reaches SEK5.66 in the final year of forecast compared to the current SEK3.35 EPS today. With a current profit margin of 4.5%, this movement will result in a margin of 5.5% by 2022.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For CLX Communications, I’ve put together three relevant aspects you should look at:
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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 CLX Communications 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 CLX Communications 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 CLX Communications? 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.