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What Should Investors Know About Spirit AeroSystems Holdings, Inc.'s (NYSE:SPR) Future?

In March 2019, Spirit AeroSystems Holdings, Inc. (NYSE:SPR) released its earnings update. Generally, analyst consensus outlook appear cautiously subdued, as a 11% rise in profits is expected in the upcoming year, against the higher past 5-year average growth rate of 25%. By 2020, we can expect Spirit AeroSystems Holdings’s bottom line to reach US$683m, a jump from the current trailing-twelve-month of US$617m. Below is a brief commentary on the longer term outlook the market has for Spirit AeroSystems Holdings. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.

See our latest analysis for Spirit AeroSystems Holdings

How will Spirit AeroSystems Holdings perform in the near future?

The longer term expectations from the 16 analysts of SPR is tilted towards the positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. To reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.

NYSE:SPR Past and Future Earnings, July 30th 2019
NYSE:SPR Past and Future Earnings, July 30th 2019

This results in an annual growth rate of 9.2% based on the most recent earnings level of US$617m to the final forecast of US$817m by 2022. This leads to an EPS of $9.22 in the final year of projections relative to the current EPS of $5.71. With a current profit margin of 8.5%, this movement will result in a margin of 9.6% by 2022.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Spirit AeroSystems Holdings, there are three pertinent factors you should further examine:

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  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 Spirit AeroSystems Holdings 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 Spirit AeroSystems Holdings is currently mispriced by the market.

  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Spirit AeroSystems Holdings? 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.