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Since Shanghai Industrial Holdings Limited (HKG:363) released its earnings in December 2018, analysts seem fairly confident, with profits predicted to increase by 5.4% next year compared with the past 5-year average growth rate of 4.0%. Currently with trailing-twelve-month earnings of HK$3.3b, we can expect this to reach HK$3.5b by 2020. Below is a brief commentary on the longer term outlook the market has for Shanghai Industrial Holdings. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.
See our latest analysis for Shanghai Industrial Holdings
How will Shanghai Industrial Holdings perform in the near future?
The longer term view from the 3 analysts covering 363 is one of positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. To get an idea of the overall earnings growth trend for 363, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.
From the current net income level of HK$3.3b and the final forecast of HK$4.0b by 2022, the annual rate of growth for 363’s earnings is 6.5%. EPS reaches HK$3.8 in the final year of forecast compared to the current HK$3.07 EPS today. With a current profit margin of 11%, this movement will result in a margin of 16% by 2022.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For Shanghai Industrial Holdings, I've put together three pertinent 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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Future Earnings: How does Shanghai Industrial 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.
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Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Shanghai Industrial 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.