For investors, increase in profitability and industry-beating performance can be essential considerations in an investment. Below, I will examine 7C Solarparken AG’s (DB:HRPK) track record on a high level, to give you some insight into how the company has been performing against its long term trend and its industry peers. See our latest analysis for 7C Solarparken

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

I use data from the most recent 12 months, 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 method allows me to analyze many different companies on a similar basis, using the latest information. For 7C Solarparken, its most recent earnings (trailing twelve month) is €7.75M, which, in comparison to last year’s level, has jumped up by 27.57%. Given that these figures are relatively myopic, I’ve determined an annualized five-year figure for HRPK’s net income, which stands at €5.21M This means generally, 7C Solarparken has been able to consistently grow its profits over the past few years as well.

What’s the driver of this growth? Let’s take a look at if it is only because of industry tailwinds, or if 7C Solarparken has seen some company-specific growth. The hike in earnings seems to be driven by a substantial top-line increase outpacing its growth rate of costs. Though this has caused a margin contraction, it has made 7C Solarparken more profitable. Eyeballing growth from a sector-level, the DE renewable energy industry has been growing its average earnings by double-digit 15.91% over the previous year, and 11.22% over the past five years. This means that whatever tailwind the industry is profiting from, 7C Solarparken is capable of leveraging this to its advantage.

What does this mean?

Though 7C Solarparken’s past data is helpful, it is only one aspect of my investment thesis. Companies that have performed well in the past, such as 7C Solarparken gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I recommend you continue to research 7C Solarparken to get a better picture of the stock by looking at:

• 1. Future Outlook: What are well-informed industry analysts predicting for HRPK’s future growth? Take a look at our free research report of analyst consensus for HRPK’s outlook.

• 2. Financial Health: Is HRPK’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.

• 3. 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 2017. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.