As Hays plc (LON:HAS) announced its earnings release on 30 June 2019, analyst consensus outlook appear cautiously subdued, with earnings expected to grow by 1.0% in the upcoming year relative to the higher past 5-year average growth rate of 13%. Presently, with latest-twelve-month earnings at UK£162m, we should see this growing to UK£163m by 2020. Below is a brief commentary on the longer term outlook the market has for Hays. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
How is Hays going to perform in the near future?
The view from 9 analysts over the next three years 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 HAS's earnings growth over these next few years.
From the current net income level of UK£162m and the final forecast of UK£184m by 2022, the annual rate of growth for HAS’s earnings is 4.8%. This leads to an EPS of £0.13 in the final year of projections relative to the current EPS of £0.11. With a current profit margin of 2.7%, this movement will result in a margin of 2.9% by 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For Hays, I've compiled three important aspects you should look at:
- Valuation: What is Hays 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 Hays is currently mispriced by the market.
- Future Earnings: How does Hays's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Hays? 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 firstname.lastname@example.org. 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.