I.T Limited (HKG:999): What We Can Expect From This Growth Stock
Based on I.T Limited's (HKG:999) earnings update on 28 February 2019, analysts seem fairly confident, as a 18% increase in profits is expected in the upcoming year, relative to the past 5-year average growth rate of 13%. With trailing-twelve-month net income at current levels of HK$443m, we should see this rise to HK$522m in 2020. Below is a brief commentary on the longer term outlook the market has for I.T. For those interested in more of an analysis of the company, you can research its fundamentals here.
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 I.T
How will I.T perform in the near future?
The 3 analysts covering 999 view its longer term outlook with a positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. 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.
This results in an annual growth rate of 16% based on the most recent earnings level of HK$443m to the final forecast of HK$696m by 2022. EPS reaches HK$0.57 in the final year of forecast compared to the current HK$0.37 EPS today. In 2022, 999's profit margin will have expanded from 5.0% to 6.5%.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For I.T, I've compiled 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 I.T 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 I.T is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of I.T? 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.
