Yahoo Finance Ascential plc (LON:ASCL): Is It A Good Long Term Opportunity?
In December 2017, Ascential plc (LON:ASCL) released its most recent earnings announcement, which suggested that the company gained from a sizeable tailwind, leading to a high double-digit earnings growth of 90.52%. Below, I’ve laid out key numbers on how market analysts perceive Ascential’s earnings growth trajectory over the next few 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 out our latest analysis for Ascential
Analysts’ expectations for the upcoming year seems buoyant, with earnings expanding by a significant 81.87%. This strong growth in earnings is expected to continue, bringing the bottom line up to UK£85.68m by 2021.
Even though it’s useful to be aware of the growth rate each year relative to today’s level, it may be more valuable to analyze the rate at which the company is growing on average every year. The benefit of this method is that we can get a bigger picture of the direction of Ascential’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’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 40.65%. This means, we can assume Ascential will grow its earnings by 40.65% every year for the next couple of years.
Next Steps:
For Ascential, there are three essential 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.
Valuation: What is ASCL 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 ASCL is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of ASCL? 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.
