Yahoo Finance What Should Investors Know About Card Factory plc’s (LON:CARD) Growth?
The latest earnings release Card Factory plc’s (LSE:CARD) announced in January 2018 confirmed that the business endured a substantial headwind with earnings falling by -11.26%. Below is a brief commentary on my key takeaways on how market analysts view Card Factory’s earnings growth outlook over the next couple of years and whether the future looks brighter. Note that I will be looking at net income excluding extraordinary items to get a better understanding of the underlying drivers of earnings. View our latest analysis for Card Factory
Market analysts’ consensus outlook for this coming year seems positive, with earnings expanding by a robust 10.32%. This growth seems to continue into the following year with rates arriving at double digit 15.49% compared to today’s earnings, and finally hitting UK£69.98M by 2021.
Even though it’s helpful to understand the growth year by year relative to today’s value, it may be more valuable to gauge the rate at which the company is moving every year, on average. The advantage of this method is that we can get a bigger picture of the direction of Card Factory’s earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To compute 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 5.86%. This means, we can expect Card Factory will grow its earnings by 5.86% every year for the next few years.
Next Steps:
For Card Factory, I’ve put together three relevant factors 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 CARD 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 CARD is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of CARD? 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.
