In This Article:
In December 2018, Raffles Medical Group Ltd (SGX:BSL) announced its most recent earnings update, which confirmed that the company experienced a small tailwind, leading to a single-digit earnings growth of 0.4%. Below, I've laid out key growth figures on how market analysts perceive Raffles Medical Group'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.
See our latest analysis for Raffles Medical Group
Market analysts' prospects for the upcoming year seems pessimistic, with earnings decreasing by a double-digit -15%. In the next couple of years, earnings are expected to continue to be below today's level, with a decline of -13% in 2021, eventually reaching S$62m in 2022.
Even though it is informative understanding the growth rate each year relative to today’s figure, it may be more beneficial to gauge the rate at which the company is growing on average every year. The advantage of this technique is that it removes the impact of near term flucuations and accounts for the overarching direction of Raffles Medical Group's earnings trajectory over time, which may be more relevant for long term investors. To calculate this rate, I put 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 -0.5%. This means that, we can anticipate Raffles Medical Group will chip away at a rate of -0.5% every year for the next few years.
Next Steps:
For Raffles Medical Group, I've compiled three relevant factors you should further examine:
-
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 BSL 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 BSL is currently mispriced by the market.
-
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of BSL? 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.