Assessing Alkali Metals Limited’s (NSEI:ALKALI) past track record of performance is a valuable exercise for investors. It enables us to reflect on whether the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess ALKALI’s recent performance announced on 30 September 2017 and evaluate these figures to its longer term trend and industry movements. View our latest analysis for Alkali Metals

Commentary On ALKALI’s Past Performance

For the most up-to-date info, I use the ‘latest twelve-month’ data, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This enables me to examine various companies on a similar basis, using the most relevant data points. “For Alkali Metals, its “, latest earnings is ₹5.0M, which compared to last year’s figure, has dropped by a significant -44.63%. Since these figures are relatively short-term thinking, I’ve created an annualized five-year value for Alkali Metals’s net income, which stands at -₹12.1M. This shows that though earnings growth was negative against the prior year, over the long run, Alkali Metals’s profits have been rising on average.

What’s enabled this growth? Let’s take a look at whether it is merely a result of industry tailwinds, or if Alkali Metals has seen some company-specific growth. In the past few years, Alkali Metals grew its bottom line faster than revenue by effectively controlling its costs. This resulted in a margin expansion and profitability over time. Viewing growth from a sector-level, the IN chemicals industry has been growing its average earnings by double-digit 12.33% over the previous twelve months, and 11.37% over the past couple of years. This suggests that whatever uplift the industry is benefiting from, Alkali Metals has not been able to gain as much as its average peer.

What does this mean?

While past data is useful, it doesn’t tell the whole story. Companies are profitable, but have volatile earnings, can have many factors influencing its business. You should continue to research Alkali Metals to get a better picture of the stock by looking at:

1. Financial Health: Is ALKALI’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.

2. Valuation: What is ALKALI worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether ALKALI is currently mispriced by the market.

3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.