Examining Mariner Corporation Limited’s (ASX:MCX) past track record of performance is a valuable exercise for investors. It enables us to understand whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess MCX’s latest performance announced on 31 December 2017 and weigh these figures against its longer term trend and industry movements. View our latest analysis for Mariner

Did MCX beat its long-term earnings growth trend and its industry?

I like to use data from the most recent 12 months, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This technique enables me to examine different companies on a similar basis, using the most relevant data points. For Mariner, its latest earnings (trailing twelve month) is -AU$141.30K, which compared to the previous year’s level, has become less negative. Since these figures are relatively short-term, I have determined an annualized five-year figure for Mariner’s earnings, which stands at -AU$466.53K. This means that, while net income is negative, it has become less negative over the years.

We can further assess Mariner’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past half a decade Mariner has seen an annual decline in revenue of -8.43%, on average. This adverse movement is a driver of the company’s inability to reach breakeven. Has the entire industry experienced this headwind? Viewing growth from a sector-level, the Australian capital markets industry has been growing, albeit, at a unexciting single-digit rate of 8.71% over the previous year, and a substantial 13.44% over the past five years. This shows that, despite the fact that Mariner is presently running a loss, it may have gained from industry tailwinds, moving earnings towards to right direction.

What does this mean?

While past data is useful, it doesn’t tell the whole story. With companies that are currently loss-making, it is always difficult to predict what will occur going forward, and when. The most useful step is to assess company-specific issues Mariner may be facing and whether management guidance has dependably been met in the past. I recommend you continue to research Mariner to get a better picture of the stock by looking at the areas below. Just a heads up – to access some parts of the Simply Wall St research tool you might be asked to create a free account, but it takes just one click and the information they provide is definitely worth it in my opinion.