The most recent earnings release Frontier Digital Ventures Limited’s (ASX:FDV) announced in December 2017 confirmed that losses became smaller relative to the prrior year’s level – great news for investors Below, I’ve laid out key growth figures on how market analysts predict Frontier Digital Ventures’s earnings growth trajectory over the next couple of years and whether the future looks brighter. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in. See our latest analysis for Frontier Digital Ventures

Analysts’ expectations for next year seems optimistic, with earnings becoming less negative, reaching -AU$8.80M in 2019. In addition, earnings are expected to continue its upward direction, reaching -AU$6.10M in 2020, and -AU$1.81M in 2021.

Even though it is helpful to be aware of the rate of growth year by year relative to today’s value, it may be more beneficial evaluating the rate at which the business is growing every year, on average. The advantage of this technique is that it ignores near term flucuations and accounts for the overarching direction of Frontier Digital Ventures’s earnings trajectory over time, which may be more relevant for long term investors. To compute this rate, I’ve appended 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 60.52%. This means that, we can assume Frontier Digital Ventures will grow its earnings by 60.52% every year for the next few years.

Next Steps:

For Frontier Digital Ventures, I’ve put together three relevant factors you should further research:

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. Valuation: What is FDV 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 FDV is currently mispriced by the market.

3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of FDV? 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 pass 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.