Stella International Holdings Limited (HKG:1836): What Are The Future Prospects?
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Looking at Stella International Holdings Limited's (HKG:1836) earnings update in December 2018, it seems that analyst forecasts are fairly optimistic, as a 46% increase in profits is expected in the upcoming year, relative to the past 5-year average growth rate of -17%. By 2020, we can expect Stella International Holdings’s bottom line to reach US$95m, a jump from the current trailing-twelve-month of US$65m. In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for Stella International Holdings in the longer term. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
See our latest analysis for Stella International Holdings
How is Stella International Holdings going to perform in the near future?
The longer term view from the 5 analysts covering 1836 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. 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 1836's earnings growth over these next few years.
By 2022, 1836's earnings should reach US$133m, from current levels of US$65m, resulting in an annual growth rate of 21%. EPS reaches $0.17 in the final year of forecast compared to the current $0.083 EPS today. Margins are currently sitting at 4.1%, which is expected to expand to 7.6% by 2022.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For Stella International Holdings, I've put together three important factors you should look at:
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.
Valuation: What is Stella International Holdings 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 Stella International Holdings is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Stella International 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!
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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.