After Marshall Motor Holdings Plc's (LON:MMH) earnings announcement in December 2018, the consensus outlook from analysts appear fairly confident, with earnings expected to grow by 28% in the upcoming year compared with the past 5-year average growth rate of 6.5%. Currently with trailing-twelve-month earnings of UK£14m, we can expect this to reach UK£18m by 2020. Below is a brief commentary around Marshall Motor Holdings's earnings outlook going forward, which may give you a sense of market sentiment for the company. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
See our latest analysis for Marshall Motor Holdings
What can we expect from Marshall Motor Holdings in the longer term?
The longer term view from the 3 analysts covering MMH is one of positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. To get an idea of the overall earnings growth trend for MMH, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.
From the current net income level of UK£14m and the final forecast of UK£18m by 2022, the annual rate of growth for MMH’s earnings is 8.2%. This leads to an EPS of £0.23 in the final year of projections relative to the current EPS of £0.18. In 2022, MMH's profit margin will have expanded from 0.6% to 0.8%.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For Marshall Motor Holdings, I've put together three essential factors you should further examine:
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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.
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Valuation: What is Marshall Motor 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 Marshall Motor Holdings is currently mispriced by the market.
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Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Marshall Motor 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!
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 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.