How Do Analysts See Jyothy Laboratories Limited (NSE:JYOTHYLAB) Performing In The Next Couple Of Years?
In March 2019, Jyothy Laboratories Limited (NSE:JYOTHYLAB) announced its latest earnings update, which suggested that the business experienced a strong tailwind, leading to a double-digit earnings growth of 10%. Today I want to provide a brief commentary on how market analysts view Jyothy Laboratories's earnings growth trajectory over the next couple of years and whether the future looks even brighter than the past. Note that I will be looking at net income excluding extraordinary items to get a better understanding of the underlying drivers of earnings.
Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
See our latest analysis for Jyothy Laboratories
Market analysts' prospects for the upcoming year seems rather subdued, with earnings growing by a single digit 8.8%. The growth outlook in the following year seems much more positive with rates reaching double digit 27% compared to today’s earnings, and finally hitting ₹3.0b by 2022.
While it’s informative knowing the rate of growth each year relative to today’s level, it may be more insightful determining the rate at which the earnings are growing every year, on average. The benefit of this approach is that it ignores near term flucuations and accounts for the overarching direction of Jyothy Laboratories's earnings trajectory over time, which may be more relevant for long term investors. To calculate this rate, I've appended a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 12%. This means that, we can anticipate Jyothy Laboratories will grow its earnings by 12% every year for the next couple of years.
Next Steps:
For Jyothy Laboratories, I've compiled three important 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 JYOTHYLAB 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 JYOTHYLAB is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of JYOTHYLAB? 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.
