Yahoo Finance How Do Analysts See Steppe Cement Ltd (LON:STCM) Performing In The Next Couple Of Years?
Steppe Cement Ltd’s (LON:STCM) latest earnings update in December 2017 suggested that the company benefited from a substantial tailwind, more than doubling its earnings from the prior year. Below is a brief commentary on my key takeaways on how market analysts perceive Steppe Cement’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. Check out our latest analysis for Steppe Cement
Analysts’ expectations for next year seems positive, with earnings growth more than doubling. Earnings continue to grow strongly in the next couple of years, finally reaching UK£10.57m in 2021.
Even though it is helpful to be aware of the growth year by year relative to today’s value, it may be more valuable to estimate the rate at which the company is rising or falling every year, on average. The advantage of this approach is that we can get a better picture of the direction of Steppe Cement’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 put a line of best fit through analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is 39.08%. This means that, we can anticipate Steppe Cement will grow its earnings by 39.08% every year for the next couple of years.
Next Steps:
For Steppe Cement, there are three pertinent factors you should further research:
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 STCM 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 STCM is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of STCM? 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.
