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As Griffin Mining Limited (LON:GFM) announced its earnings release on 31 December 2018, analyst forecasts seem fairly subdued, with profits predicted to rise by -35% next year relative to the higher past 5-year average growth rate of 53%. Currently with trailing-twelve-month earnings of US$25m, we can expect this to reach US$16m by 2020. Below is a brief commentary on the longer term outlook the market has for Griffin Mining. Investors wanting to learn more about other aspects of the company should research its fundamentals here.
How is Griffin Mining going to perform in the near future?
The longer term view from the 1 analysts covering GFM is one of positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. 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 26% based on the most recent earnings level of US$25m to the final forecast of US$48m by 2022. EPS reaches $0.28 in the final year of forecast compared to the current $0.15 EPS today. With a current profit margin of 26%, this movement will result in a margin of 31% by 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For Griffin Mining, I've compiled three pertinent aspects 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 Griffin Mining 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 Griffin Mining is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Griffin Mining? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.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.