Yahoo Finance Ramelius Resources Limited (ASX:RMS): What Are The Future Prospects?
In December 2018, Ramelius Resources Limited (ASX:RMS) announced its earnings update. Overall, analyst consensus outlook appear vastly optimistic, with profits predicted to ramp up by an impressive 72% next year, compared with the past 5-year average growth rate of 62%. Currently with trailing-twelve-month earnings of AU$31m, we can expect this to reach AU$53m by 2020. Below is a brief commentary on the longer term outlook the market has for Ramelius Resources. For those interested in more of an analysis of the company, you can research its fundamentals here.
Check out our latest analysis for Ramelius Resources
Can we expect Ramelius Resources to keep growing?
Longer term expectations from the 3 analysts covering RMS’s stock is one of positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of RMS's earnings growth over these next few years.
From the current net income level of AU$31m and the final forecast of AU$69m by 2022, the annual rate of growth for RMS’s earnings is 13%. This leads to an EPS of A$0.077 in the final year of projections relative to the current EPS of A$0.058. In 2022, RMS's profit margin will have expanded from 9.0% to 19%.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For Ramelius Resources, I've put together three pertinent aspects 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 Ramelius Resources 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 Ramelius Resources is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Ramelius Resources? 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.
