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Measuring Beijing Enterprises Environment Group Limited's (HKG:154) track record of past performance is a valuable exercise for investors. It allows us to understand whether or not the company has met or exceed expectations, which is an insightful signal for future performance. Today I will assess 154's recent performance announced on 31 December 2018 and compare these figures to its historical trend and industry movements.
View our latest analysis for Beijing Enterprises Environment Group
How 154 fared against its long-term earnings performance and its industry
154's trailing twelve-month earnings (from 31 December 2018) of HK$265m has jumped 39% compared to the previous year.
However, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 54%, indicating the rate at which 154 is growing has slowed down. Why could this be happening? Well, let's look at what's going on with margins and whether the whole industry is facing the same headwind.
In terms of returns from investment, Beijing Enterprises Environment Group has fallen short of achieving a 20% return on equity (ROE), recording 9.5% instead. Furthermore, its return on assets (ROA) of 3.2% is below the HK Commercial Services industry of 6.3%, indicating Beijing Enterprises Environment Group's are utilized less efficiently. However, its return on capital (ROC), which also accounts for Beijing Enterprises Environment Group’s debt level, has increased over the past 3 years from 1.6% to 5.4%.
What does this mean?
Beijing Enterprises Environment Group's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. Companies that have performed well in the past, such as Beijing Enterprises Environment Group gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I suggest you continue to research Beijing Enterprises Environment Group to get a more holistic view of the stock by looking at:
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Future Outlook: What are well-informed industry analysts predicting for 154’s future growth? Take a look at our free research report of analyst consensus for 154’s outlook.
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Financial Health: Are 154’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.