Yahoo Finance Silver Lake Resources Limited (ASX:SLR): Poised For Long-Term Success?
The latest earnings announcement Silver Lake Resources Limited (ASX:SLR) released in June 2018 showed that the company benefited from a significant tailwind, more than doubling its earnings from the prior year. Below is a brief commentary on my key takeaways on how market analysts perceive Silver Lake Resources’s earnings growth outlook over the next few 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.
Check out our latest analysis for Silver Lake Resources
Market analysts’ consensus outlook for the coming year seems positive, with earnings increasing by a robust 18.0%. Earnings are predicted to peak in the following year, reaching AU$41.8m before reducing in 2021
While it’s useful to understand the growth each year relative to today’s value, it may be more valuable evaluating the rate at which the business is moving every year, on average. The pro of this approach is that it removes the impact of near term flucuations and accounts for the overarching direction of Silver Lake Resources’s earnings trajectory over time, be more volatile. To calculate this rate, I’ve inserted 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 26.0%. This means that, we can anticipate Silver Lake Resources will grow its earnings by 26.0% every year for the next few years.
Next Steps:
For Silver Lake Resources, there are three relevant aspects you should look at:
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 SLR 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 SLR is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of SLR? 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.
