Berenberg Bank cut their target price on Halma from GBX 2,980 ($36.01) to GBX 2,260 ($27.31) and set a “hold” rating on the stock in a report on Thursday, July 21st. Shore Capital reaffirmed a “buy” rating on shares of Halma in a report on Thursday, June 16th. Several brokerages have commented on HLMA. The average 12 month price objective among brokerages that have issued ratings on the stock in the last year is GBX 2,388.20 ($28.86). Three investment analysts have rated the stock with a sell rating, three have issued a hold rating and one has given a buy rating to the company. Thank you for reading.Shares of Halma plc ( LON:HLMA – Get Rating) have earned an average recommendation of “Hold” from the seven research firms that are currently covering the company, Marketbeat Ratings reports. Simply Wall St has no position in any stocks mentioned. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. We aim to bring you long-term focused analysis driven by fundamental data. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Alternatively, email article by Simply Wall St is general in nature. Love or hate this article? Concerned about the content? Get in touch with us directly.
Halma stock free#
To know more about the company's future earnings growth forecasts take a look at this free report on analyst forecasts for the company to find out more. With that said, the latest industry analyst forecasts reveal that the company's earnings growth is expected to slow down. This of course has caused the company to see a good amount of growth in its earnings. Specifically, we like that the company is reinvesting a huge chunk of its profits at a high rate of return.
In total, we are pretty happy with Halma's performance.
As a result, Halma's ROE is not expected to change by much either, which we inferred from the analyst estimate of 20% for future ROE. Our latest analyst data shows that the future payout ratio of the company over the next three years is expected to be approximately 32%. Moreover, Halma is determined to keep sharing its profits with shareholders which we infer from its long history of paying a dividend for at least ten years.
Halma has a healthy combination of a moderate three-year median payout ratio of 40% (or a retention ratio of 60%) and a respectable amount of growth in earnings as we saw above, meaning that the company has been making efficient use of its profits. Is Halma Efficiently Re-investing Its Profits? If you're wondering about Halma's's valuation, check out this gauge of its price-to-earnings ratio, as compared to its industry. Doing so will help them establish if the stock's future looks promising or ominous. What investors need to determine next is if the expected earnings growth, or the lack of it, is already built into the share price. LSE:HLMA Past Earnings Growth May 18th 2020Įarnings growth is a huge factor in stock valuation. Next, on comparing with the industry net income growth, we found that Halma's reported growth was lower than the industry growth of 18% in the same period, which is not something we like to see. This probably laid the ground for Halma's moderate 13% net income growth seen over the past five years. On comparing with the average industry ROE of 10% the company's ROE looks pretty remarkable. A Side By Side comparison of Halma's Earnings Growth And 17% ROEĪt first glance, Halma seems to have a decent ROE. Generally speaking, other things being equal, firms with a high return on equity and profit retention, have a higher growth rate than firms that don’t share these attributes. We now need to evaluate how much profit the company reinvests or "retains" for future growth which then gives us an idea about the growth potential of the company. We have already established that ROE serves as an efficient profit-generating gauge for a company's future earnings. What Has ROE Got To Do With Earnings Growth? So, this means that for every £1 of its shareholder's investments, the company generates a profit of £0.17. The 'return' is the income the business earned over the last year. So, based on the above formula, the ROE for Halma is:ġ7% = UK£180m ÷ UK£1.1b (Based on the trailing twelve months to September 2019). Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity ROE can be calculated by using the formula:
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