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Godrej Agrovet Limited's (NSE:GODREJAGRO) announced its latest earnings update in March 2019, which indicated that the business benefited from a strong tailwind, eventuating to a double-digit earnings growth of 45%. Below, I've laid out key growth figures on how market analysts perceive Godrej Agrovet's earnings growth outlook over the next couple of years and whether the future looks even brighter than the past. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in.

View our latest analysis for Godrej Agrovet

Market analysts' prospects for this coming year seems pessimistic, with earnings declining by a double-digit -11%. However, the next few years seem to illustrate a completely different picture, with expected earnings growth rates reaching double digit 10% compared to today’s level and continues to increase.

While it is useful to be aware of the rate of growth each year relative to today’s value, it may be more valuable to analyze the rate at which the business is growing every year, on average. The pro of this method is that we can get a bigger picture of the direction of Godrej Agrovet's earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To calculate this rate, I've inserted 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 7.0%. This means that, we can expect Godrej Agrovet will grow its earnings by 7.0% every year for the next couple of years.

Next Steps:

For Godrej Agrovet, I've put together three fundamental aspects 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 GODREJAGRO 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 GODREJAGRO is currently mispriced by the market.

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