Need help making estimates by extrapolation of historical results?

Question:

I want to use math or statistics to find the estimate of what Sales are going to be for individual companies whose stock I want to analyze. The following are actual results: +++++ +++++ Year (1) $81.2 Year(2) 139.9, up 72% Year(3) $189.9, up 35%
Year (4) $249.1, up 31% Year(5) $308.4, up 23% Year(6) $379.5, up 23% Year(7) $ 454.1, up 19%

What should next year sales be and how can i mathematically derive them? Best answer would take into account that there is a downward trend and not just some regression to the mean type of method...

Thanks!

Answer:
Right, there's a downward trend, so any type of average would make your estimate too high. If you are interested in buying the stock of a company, you should be checking and comparing their figures quarterly and you should know that total sales mean nothing without knowing what kind of profit they are producing. Nevertheless, I would count on a sales increase of somewhere between 15 and 18 percent for next year, based on the historical figures.

average the annual increase in sales and apply the result to latest sales figure

Need help making estimates by extrapolation of historical results?

Hot Topic