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Can Fin Homes Limited's (NSE:CANFINHOME) latest earnings announcement in June 2019 confirmed that the company experienced a slight tailwind, eventuating to a single-digit earnings growth of 3.7%. Investors may find it useful to understand how market analysts predict Can Fin Homes's earnings growth outlook over the next couple of years and whether the future looks even brighter than the past. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in.
View our latest analysis for Can Fin Homes
Market analysts' consensus outlook for this coming year seems optimistic, with earnings growing by a robust 22%. This growth seems to continue into the following year with rates reaching double digit 55% compared to today’s earnings, and finally hitting ₹4.8b by 2022.
While it’s informative understanding the growth year by year relative to today’s figure, it may be more insightful analyzing the rate at which the business is moving on average every year. The advantage of this technique is that we can get a better picture of the direction of Can Fin Homes'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 analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is 18%. This means, we can expect Can Fin Homes will grow its earnings by 18% every year for the next few years.
Next Steps:
For Can Fin Homes, I've compiled three relevant 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 CANFINHOME 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 CANFINHOME 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 CANFINHOME? 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.