What Should Investors Know About Ringmetall AG's (FRA:HP3) Future?
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Looking at Ringmetall AG's (FRA:HP3) earnings update in December 2018, it seems that analyst forecasts are fairly optimistic, as a 35% increase in profits is expected in the upcoming year, though this is noticeably lower than the historical 5-year average earnings growth of 53%. Presently, with latest-twelve-month earnings at €4.8m, we should see this growing to €6.5m by 2020. In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for Ringmetall in the longer term. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.
Check out our latest analysis for Ringmetall
How will Ringmetall perform in the near future?
The view from 2 analysts over the next three years is one of positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. 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.
By 2022, HP3's earnings should reach €9.2m, from current levels of €4.8m, resulting in an annual growth rate of 20%. EPS reaches €0.32 in the final year of forecast compared to the current €0.17 EPS today. With a current profit margin of 4.4%, this movement will result in a margin of 6.8% by 2022.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For Ringmetall, I've put together three essential 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 Ringmetall 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 Ringmetall is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Ringmetall? 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.
