In September 2017, The Container Store Group Inc (NYSE:TCS) released its most recent earnings announcement, which signalled that the business gained from a significant tailwind, more than doubling its earnings from the prior year. Below, I’ve laid out key growth figures on how market analysts predict Container Store Group’s earnings growth trajectory over the next couple of 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. Check out our latest analysis for Container Store Group
Market analysts’ consensus outlook for the upcoming year seems optimistic, with earnings growth more than doubling. Earnings continue to grow strongly in the next couple of years, finally reaching $19.5M in 2021.
Although it’s helpful to be aware of the rate of growth year by year relative to today’s figure, it may be more beneficial estimating the rate at which the business is rising or falling on average every year. The pro of this approach is that it ignores near term flucuations and accounts for the overarching direction of Container Store Group’s earnings trajectory over time, which may be more relevant for long term investors. To calculate this rate, I’ve inserted 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 18.29%. This means, we can expect Container Store Group will grow its earnings by 18.29% every year for the next few years.
Next Steps:
For Container Store Group, I’ve compiled three key factors you should look at:
1. 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.
2. Valuation: What is TCS 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 TCS is currently mispriced by the market.
3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of TCS? 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.