Question

sunland technologies inc an indian tech company reported net income of 421000000 this year. analysts expect the company earnings to be 1550000000 in five years what is the expected annual growth rate in the companys earnings

Answer 1

To find the expected annual growth rate for Sunland Technologies Inc., apply the compound annual growth rate formula, using the present value of earnings, future value of earnings, and number of years. This will calculate the growth rate over the specified five-year period.

Step-by-step explanation:

The question asks for the expected annual growth rate of Sunland Technologies Inc.'s earnings over a five-year period. The formula to calculate this rate is based on the future value, present value, and the number of periods. We can apply the formula for the compound annual growth rate (CAGR):

CAGR = (FV / PV)^(1/n) - 1

Where:

• FV = Future Value of the earnings (1,550,000,000)
• PV = Present Value of the earnings (421,000,000)
• n = Number of periods (years) (5)

Plugging the values into the formula gives us:

CAGR = (1,550,000,000 / 421,000,000)^(1/5) - 1

Calculating the result will give the expected annual growth rate.