Will CITIC Limited's (HKG:267) Earnings Grow In The Next 12 Months?
As CITIC Limited (HKG:267) announced its earnings release on 31 December 2018, analysts seem fairly confident, as a 5.2% increase in profits is expected in the upcoming year, against the past 5-year average growth rate of -6.2%. With trailing-twelve-month net income at current levels of HK$50b, we should see this rise to HK$53b in 2020. I will provide a brief commentary around the figures and analyst expectations in the near term. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
View our latest analysis for CITIC
How will CITIC perform in the near future?
The view from 3 analysts over the next three years is one of positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. To get an idea of the overall earnings growth trend for 267, 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.
From the current net income level of HK$50b and the final forecast of HK$60b by 2022, the annual rate of growth for 267’s earnings is 5.7%. This leads to an EPS of HK$2.06 in the final year of projections relative to the current EPS of HK$1.73. In 2022, 267's profit margin will have expanded from 7.3% to 9.6%.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For CITIC, there are three relevant factors 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 CITIC 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 CITIC is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of CITIC? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
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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.
