Yahoo Finance What Are Analysts Saying About The Future Of Trustpower Limited’s (NZE:TPW)?
In March 2018, Trustpower Limited (NZSE:TPW) announced its most recent earnings update, which indicated that the business gained from a sizeable tailwind, leading to a high double-digit earnings growth of 51.12%. Below, I’ve laid out key numbers on how market analysts view Trustpower’s earnings growth trajectory over the next couple of years and whether the future looks even brighter than the past. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings. View our latest analysis for Trustpower
Analysts’ expectations for the upcoming year seems pessimistic, with earnings declining by -4.46%. In the next couple of years, earnings are expected to continue to be below today’s level, with a reduction of -4.69% in 2020, eventually reaching NZ$107.47M in 2021.
Even though it is useful to understand the growth year by year relative to today’s figure, it may be more valuable evaluating the rate at which the company is rising or falling every year, on average. The benefit of this technique is that we can get a better picture of the direction of Trustpower’s earnings trajectory over the long run, irrespective of near term fluctuations, fluctuate up and down. To calculate 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 1.77%. This means that, we can assume Trustpower will grow its earnings by 1.77% every year for the next couple of years.
Next Steps:
For Trustpower, I’ve compiled three key factors 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.
Valuation: What is TPW 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 TPW is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of TPW? 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.
