Luk Fook Holdings (International) Limited (HKG:590): What Are The Future Prospects?




  • In Business
  • 2019-09-08 00:52:49Z
  • By Simply Wall St.
 

Luk Fook Holdings (International) Limited's (HKG:590) released its most recent earnings update in July 2019, which revealed that the company experienced a small tailwind, eventuating to a single-digit earnings growth of 9.0%. Below is a brief commentary on my key takeaways on how market analysts view Luk Fook Holdings (International)'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 Luk Fook Holdings (International)

Market analysts' prospects for next year seems rather subdued, with earnings expanding by a single digit 4.2%. The growth outlook in the following year seems much more optimistic with rates arriving at double digit 13% compared to today's earnings, and finally hitting HK$1.7b by 2022.

Even though it's useful to understand the growth each year relative to today's figure, it may be more beneficial to evaluate the rate at which the company is moving on average every year. The pro of this method is that we can get a bigger picture of the direction of Luk Fook Holdings (International)'s earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To calculate this rate, I put 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 5.6%. This means that, we can expect Luk Fook Holdings (International) will grow its earnings by 5.6% every year for the next few years.

Next Steps:

For Luk Fook Holdings (International), I've compiled three relevant factors you should further examine:

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.

COMMENTS

More Related News

These Factors Make Ring Energy, Inc. (NYSEMKT:REI) An Interesting Investment
These Factors Make Ring Energy, Inc. (NYSEMKT:REI) An Interesting Investment

Attractive stocks have exceptional fundamentals. In the case of Ring Energy, Inc. (NYSEMKT:REI), there's is a company...

Should You Be Happy With Gyldendal A/S
Should You Be Happy With Gyldendal A/S's (CPH:GYLD B) Performance Lately?

When Gyldendal A/S (CPSE:GYLD B) announced its most recent earnings (30 June 2019), I did two things: looked at its...

Here
Here's What Essity AB (publ)'s (STO:ESSITY B) P/E Is Telling Us

Today, we'll introduce the concept of the P/E ratio for those who are learning about investing. We'll look at Essity...

Is Chen Hsong Holdings Limited
Is Chen Hsong Holdings Limited's (HKG:57) High P/E Ratio A Problem For Investors?

The goal of this article is to teach you how to use price to earnings ratios (P/E ratios). To keep it practical, we'll...

Don
Don't Sell Playa Hotels & Resorts N.V. (NASDAQ:PLYA) Before You Read This

This article is for investors who would like to improve their understanding of price to earnings ratios (P/E ratios...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

Top News: Business

facebook
Hit "Like"
Don't miss any important news
Thanks, you don't need to show me this anymore.