When Biancamano Sp.A. (BIT:BCM) released its most recent earnings update (30 June 2017), I compared it against two factor: its historical earnings track record, and the performance of its industry peers on average. Being able to interpret how well Biancamano has done so far requires weighing its performance against a benchmark, rather than looking at a standalone number at a point in time. In this article, I’ve summarized the key takeaways on how I see BCM has performed. See our latest analysis for Biancamano
How Did BCM’s Recent Performance Stack Up Against Its Past?
I like to 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 analyze various companies on a similar basis, using the most relevant data points. For Biancamano, its most recent bottom-line (trailing twelve month) is -€3.47M, which, against last year’s level, has become less negative. Given that these figures may be fairly myopic, I have created an annualized five-year figure for BCM’s net income, which stands at -€23.53M. This means that, though net income is negative, it has become less negative over the years.
We can further evaluate Biancamano’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past half a decade Biancamano has seen an annual decline in revenue of -19.83%, on average. This adverse movement is a driver of the company’s inability to reach breakeven. Has the entire industry experienced this headwind? Inspecting growth from a sector-level, the IT commercial services industry has been relatively flat in terms of earnings growth in the past twelve months, levelling off from a notable 12.19% over the past five years. This shows that though Biancamano is presently loss-making, any recent headwind the industry is facing, Biancamano is less exposed compared to its peers.
What does this mean?
Biancamano’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Companies that incur net loss is always hard to envisage what will occur going forward, and when. The most useful step is to assess company-specific issues Biancamano may be facing and whether management guidance has regularly been met in the past. You should continue to research Biancamano to get a more holistic view of the stock by looking at: