What Should Investors Know About PVR Limited's (NSE:PVR) Future?
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On 31 March 2019, PVR Limited (NSE:PVR) released its earnings update. Generally, analysts seem cautiously optimistic, as upcoming earnings growth is expected to be 26% next year, similar to the range of average earnings growth for the past five years of 25% per year. Currently with trailing-twelve-month earnings of ₹1.8b, we can expect this to reach ₹2.3b by 2020. In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for PVR in the longer term. For those interested in more of an analysis of the company, you can research its fundamentals here.
Check out our latest analysis for PVR
How is PVR going to perform in the near future?
The longer term expectations from the 18 analysts of PVR is tilted towards the positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of PVR's earnings growth over these next few years.
From the current net income level of ₹1.8b and the final forecast of ₹3.3b by 2022, the annual rate of growth for PVR’s earnings is 20%. This leads to an EPS of ₹66.58 in the final year of projections relative to the current EPS of ₹39.29. Margins are currently sitting at 6.0%, which is expected to expand to 7.0% by 2022.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For PVR, I've put together three relevant aspects you should further examine:
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.
Management:Have insiders been ramping up their shares to take advantage of the market's sentiment for PVR's future outlook? Check out our management and board analysis with insights on CEO compensation and governance factors.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of PVR? 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.