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Far East Horizon Limited's (HKG:3360) announced its latest earnings update in March 2019, which indicated that the company experienced a strong tailwind, eventuating to a double-digit earnings growth of 22%. Below, I've laid out key numbers on how market analysts predict Far East Horizon's earnings growth outlook over the next few years and whether the future looks even brighter than the past. 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 Far East Horizon
Market analysts' prospects for next year seems positive, with earnings growing by a robust 16%. This growth seems to continue into the following year with rates arriving at double digit 33% compared to today’s earnings, and finally hitting CN¥6.0b by 2022.
Even though it is informative understanding the growth rate year by year relative to today’s value, it may be more insightful to evaluate the rate at which the earnings are growing on average every year. The pro of this method is that we can get a better picture of the direction of Far East Horizon'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 14%. This means, we can expect Far East Horizon will grow its earnings by 14% every year for the next few years.
Next Steps:
For Far East Horizon, I've compiled three fundamental factors you should further research:
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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 3360 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 3360 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 3360? 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.