Yahoo Movies What Do Analysts Think About EPAM Systems, Inc.’s (NYSE:EPAM) Earnings Trend?
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In December 2018, EPAM Systems, Inc. (NYSE:EPAM) released its latest earnings announcement, which confirmed that the company gained from a significant tailwind, more than doubling its earnings from the prior year. Below, I’ve laid out key numbers on how market analysts predict EPAM Systems’s earnings growth outlook over the next few 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.
Check out our latest analysis for EPAM Systems
Analysts’ expectations for this coming year seems rather muted, with earnings rising by a single digit 8.7%. The growth outlook in the following year seems much more optimistic with rates reaching double digit 32% compared to today’s earnings, and finally hitting US$416m by 2022.
While it’s informative knowing the growth rate year by year relative to today’s figure, it may be more insightful to gauge the rate at which the business is rising or falling on average every year. The advantage of this method is that we can get a bigger picture of the direction of EPAM Systems’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’ve appended 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 15%. This means that, we can expect EPAM Systems will grow its earnings by 15% every year for the next couple of years.
Next Steps:
For EPAM Systems, there are three fundamental factors you should further research:
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 EPAM 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 EPAM is currently mispriced by the market.
Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of EPAM? 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.
