Yahoo Finance Will Bodycote plc's (LON:BOY) Earnings Grow In Next 12 Months?
After Bodycote plc's (LON:BOY) recent earnings announcement in December 2018, it seems that analyst forecasts are fairly pessimistic, with profits predicted to drop by 3.0% next year against the past 5-year average growth rate of 8.4%. Currently with a trailing-twelve-month profit of UK£103m, the consensus growth rate suggests that earnings will drop to UK£100m by 2020. I will provide a brief commentary around the figures and analyst expectations in the near term. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
View our latest analysis for Bodycote
How is Bodycote going to perform in the near future?
The view from 17 analysts over the next three years is one of positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. To reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.
This results in an annual growth rate of 1.9% based on the most recent earnings level of UK£103m to the final forecast of UK£109m by 2022. EPS reaches £0.58 in the final year of forecast compared to the current £0.54 EPS today. As revenues is expected to outpace earnings, analysts expect margins to contract from the current 14% to 14% by the end of 2022.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For Bodycote, I've put together three fundamental 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 Bodycote 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 Bodycote is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Bodycote? 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.
