The growth prospects of shares in AstraZeneca plc (LON:AZN) (AZN.L), Boohoo Group PLC (LON:BOO) (BOO.L), BAE Systems plc (LON:BA) (BA.L) and Ocado Group PLC (LON:OCDO) (OCDO.L) are the focus of this article. Could they generate improving financial performance?
AstraZeneca is facing an improving financial outlook. It is forecast to post a rise in EPS of 13% in the current year, which would bring to an end a period of profit decline.
The company’s investment in its pipeline has been a key reason for its improving outlook in my view. With it having a strong balance sheet and improving cash flow to my mind, I feel that it could continue to deliver on its growth strategy. With a PEG ratio of 1.6, I feel that AstraZeneca’s share price could be undervalued.
Boohoo’s share price performance has been volatile of late. Investors appear to be cautious about the online retail sector after its industry peer, ASOS, announced a profit warning.
Boohoo, though, released a recent trading update that stated its performance has been in line with expectations. With a refreshed management team set to be put in place and the potential for a tailwind as shoppers increasingly move online, I’m optimistic about the stock’s long-term performance.
BAE’s share price growth prospects could improve over the next few years in my view. The FTSE 100 company could benefit from increasing defence spending in the US and across a number of other NATO members.
Although there are concerns about the outlook for Saudi Arabia, one of the company’s largest customers, I feel that BAE has a sound business model which could outperform a range of its industry peers in future years.
Ocado’s growth outlook continues to be positive in my view. It has been able to sign a number of agreements with major retailers, and this trend could continue as shopping online becomes increasingly popular among consumers.
While there are risks facing the business, such as the potential for a weak UK economy and a lack of profitability, I feel that Ocado may be able to generate further sales growth. This could help to improve investor sentiment after what has been an uncertain period for the stock.