Earnings growth generally reflects effective management decisions, successful operations, and improved efficiency, which contribute to shareholder value. Additionally, strong earnings growth often causes stock prices to rise, making it an important factor when choosing stocks.
Thank you for reading this post, don't forget to subscribe!And for those looking for companies with high-growth expectations, three stocks – Elf Beauty ELF, Nvidia NVDA, and Lamb Weston LW – fit all the criteria nicely.
In addition to strong forecast growth, all three have earned a favorable Zacks Rank, reflecting recent positive earnings estimate revisions. As many know, rising earnings estimate revisions typically impact near-term stock performance.
Let’s take a closer look at each.
elf beauty
Elf Beauty is a cosmetics company, whose products mainly include facial makeup, eye makeup, lip products, nail products, and cosmetic kits. This stock is a Zacks Rank #1 (Strong Buy), with earnings expectations running high across the board.
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The company’s projected growth is impossible to ignore, with consensus expectations indicating 50% earnings growth in its current year on 45% higher revenues. And looking towards fiscal year 2025, it is estimated that earnings will grow by 18% with a 20% increase in sales.
As shown below, ELF’s top line growth has already been pretty solid.
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And Elf Beauty has consistently posted strong quarterly results, exceeding the Zacks Consensus EPS Estimate by an average of 110% over its last four prints. In its latest release, the company reported a 90% EPS beat and revenue 17% ahead of the Zacks Consensus Sales Estimate.
NVIDIA
NVIDIA has been the story of 2023, with the company’s shares rising on the back of strong quarterly releases and enthusiasm for artificial intelligence (AI). The revision trend for the current year has been extremely bullish, with the $10.74 Zacks Consensus EPS estimate rising 140% from last October.
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Demand for the company’s AI chips is expected to further boost its top- and bottom-line performance, with earnings projected to grow 220% and revenue to double in the current year.
And growth is not expected to slow down, with FY20 estimates indicating an additional 50% earnings growth on 50% higher sales.
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Keep an eye out for the company’s next quarterly release, expected on November 21st, as the Zacks Consensus EPS Estimate of $3.34 suggests a 480% increase year-over-year. Our consensus revenue estimate is $16.1 billion in sales, up 171% from the year-ago figure.
Lamb Weston
Lamb Weston, current Zacks Rank #1 (Strong Buy), is a leading global manufacturer, marketer and distributor of value-added frozen potato products. The company has seen positive earnings estimate revisions in almost all time frames.
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Not unlike the above, the company boasts a positive growth trajectory, with its earnings projected to grow 25% in the current year and an additional 6.3% in FY20. Regarding top-line expectations, it is estimated to grow by 30% in the current year and 5.4% in FY20.
LW shares may also appeal to those with a preference for income, with shares currently yielding 1.3% annually, with a sustainable payout ratio of 20% of the company’s earnings. And LW has demonstrated a shareholder-friendly disposition, reflected by its 7.5% five-year annual dividend growth rate.
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ground level
Growth in earnings generally indicates that management decisions are yielding positive results, operations are running smoothly, and efficiency is increasing, all of which contribute to increased shareholder value.
And for those looking for companies with high-growth trajectories, the three above – Elf Beauty ELF, Nvidia NVDA, and Lamb Weston LW – fit the criteria well.
In addition to strong forecast growth, all three have earned a favorable Zacks Rank, indicating bullishness among analysts.
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Source: finance.yahoo.com
