Measuring Superior Energy Services Inc’s (NYSE:SPN) track record of past performance is an insightful exercise for investors. It enables us to reflect on whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess SPN’s recent performance announced on 31 December 2017 and compare these figures to its historical trend and industry movements. View our latest analysis for Superior Energy Services
How SPN fared against its long-term earnings performance and its industry
To account for any quarterly or half-yearly updates, I 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 blend allows me to assess different companies in a uniform manner using new information. For Superior Energy Services, its most recent trailing-twelve-month earnings is -US$187.01M, which, against the prior year’s level, has become less negative. Since these figures may be fairly myopic, I’ve computed an annualized five-year figure for SPN’s net income, which stands at -US$285.05M. This means that, despite the fact that net income is negative, it has become less negative over the years.
We can further analyze Superior Energy Services’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past five years Superior Energy Services has seen an annual decline in revenue of -7.52%, 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 US energy services industry has been growing its average earnings by double-digit 22.95% over the past twelve months, . This is a turnaround from a volatile drop of -22.57% in the past few years. This means despite the fact that Superior Energy Services is presently loss-making, it may have only just gained from the recent industry expansion, moving earnings into a more favorable position.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Companies that incur net loss is always difficult to envisage what will happen in the future and when. The most useful step is to examine company-specific issues Superior Energy Services may be facing and whether management guidance has dependably been met in the past. I suggest you continue to research Superior Energy Services to get a better picture of the stock by looking at: