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When Bannari Amman Sugars Limited's (NSE:BANARISUG) announced its latest earnings (30 June 2019), I wanted to understand how these figures stacked up against its past performance. The two benchmarks I used were Bannari Amman Sugars's average earnings over the past couple of years, and its industry performance. These are useful yardsticks to help me gauge whether or not BANARISUG actually performed well. Below is a quick commentary on how I see BANARISUG has performed.
See our latest analysis for Bannari Amman Sugars
Did BANARISUG perform worse than its track record and industry?
BANARISUG's trailing twelve-month earnings (from 30 June 2019) of ₹785m has declined by -7.5% compared to the previous year.
Furthermore, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 29%, indicating the rate at which BANARISUG is growing has slowed down. Why is this? Well, let's look at what's going on with margins and whether the rest of the industry is experiencing the hit as well.
In terms of returns from investment, Bannari Amman Sugars has fallen short of achieving a 20% return on equity (ROE), recording 6.6% instead. Furthermore, its return on assets (ROA) of 5.2% is below the IN Food industry of 6.8%, indicating Bannari Amman Sugars's are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Bannari Amman Sugars’s debt level, has declined over the past 3 years from 14% to 9.0%.
What does this mean?
Though Bannari Amman Sugars's past data is helpful, it is only one aspect of my investment thesis. Companies that are profitable, but have volatile earnings, can have many factors influencing its business. I suggest you continue to research Bannari Amman Sugars to get a better picture of the stock by looking at:
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Future Outlook: What are well-informed industry analysts predicting for BANARISUG’s future growth? Take a look at our free research report of analyst consensus for BANARISUG’s outlook.
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Financial Health: Are BANARISUG’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.
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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 trailing twelve months from 30 June 2019. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.