Yahoo Finance What Should Investors Know About The Future Of Johns Lyng Group Limited’s (ASX:JLG)?
Looking at Johns Lyng Group Limited’s (ASX:JLG) earnings update in June 2018, analyst consensus outlook appear cautiously optimistic, with earnings expected to grow by 32% in the upcoming year against the past 5-year average growth rate of 24%. By 2019, we can expect Johns Lyng Group’s bottom line to reach AU$14m, a jump from the current trailing-twelve-month AU$11m. In this article, I’ve outline a few earnings growth rates to give you a sense of the market sentiment for Johns Lyng Group in the longer term. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
See our latest analysis for Johns Lyng Group
Can we expect Johns Lyng Group to keep growing?
The 1 analysts covering JLG view its longer term outlook with a positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. To get an idea of the overall earnings growth trend for JLG, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.
This results in an annual growth rate of 4.9% based on the most recent earnings level of AU$11m to the final forecast of AU$13m by 2021. This leads to an EPS of A$0.061 in the final year of projections relative to the current EPS of A$0.054. The bottom-line growth seems to be caused by cost-cutting initiatives, since top-line is predicted to rise at a slower pace than earnings. Margins is currently sitting at 3.7%, which is expected to expand to 4.1% by 2021.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For Johns Lyng Group, there are three relevant factors you should further research:
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 Johns Lyng Group 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 Johns Lyng Group is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Johns Lyng Group? 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 past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
