Yahoo Finance How Do Analysts See IRESS Limited (ASX:IRE) Performing In The Next Couple Of Years?
The most recent earnings announcement IRESS Limited's (ASX:IRE) released in December 2018 suggested that the business benefited from a slight tailwind, leading to a single-digit earnings growth of 7.3%. Below, I've presented key growth figures on how market analysts predict IRESS's earnings growth trajectory 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 IRESS
Market analysts' consensus outlook for this coming year seems optimistic, with earnings climbing by a robust 19%. This growth seems to continue into the following year with rates reaching double digit 36% compared to today’s earnings, and finally hitting AU$100m by 2022.
While it’s useful to understand the growth each year relative to today’s figure, it may be more valuable analyzing the rate at which the company is rising or falling every year, on average. The benefit of this approach is that it ignores near term flucuations and accounts for the overarching direction of IRESS's earnings trajectory over time, 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 15%. This means, we can presume IRESS will grow its earnings by 15% every year for the next few years.
Next Steps:
For IRESS, I've compiled three fundamental 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 IRE 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 IRE is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of IRE? 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.
