Yahoo Finance What Should Investors Know About Alfa Financial Software Holdings PLC’s (LON:ALFA) Future?
As Alfa Financial Software Holdings PLC (LON:ALFA) announced its earnings release on 31 December 2018, analyst forecasts seem fairly subdued, as a 4.1% rise in profits is expected in the upcoming year, relative to the higher past 5-year average growth rate of 19%. With trailing-twelve-month net income at current levels of UK£18m, we should see this rise to UK£19m in 2020. I will provide a brief commentary around the figures and analyst expectations in the near term. For those interested in more of an analysis of the company, you can research its fundamentals here.
View our latest analysis for Alfa Financial Software Holdings
Exciting times ahead?
The 4 analysts covering ALFA view its longer term outlook with a positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. To understand the overall trajectory of ALFA’s earnings growth over these next fews years, I’ve fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope.
From the current net income level of UK£18m and the final forecast of UK£23m by 2022, the annual rate of growth for ALFA’s earnings is 6.0%. This leads to an EPS of £0.076 in the final year of projections relative to the current EPS of £0.063. With a current profit margin of 26%, this movement will result in a margin of 28% by 2022.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For Alfa Financial Software Holdings, I’ve compiled three key factors you should look at:
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 Alfa Financial Software Holdings 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 Alfa Financial Software Holdings is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Alfa Financial Software Holdings? 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.
