Examining how Cramo Oyj (HLSE:CRA1V) is performing as a company requires looking at more than just a years’ earnings. Below, I will run you through a simple sense check to build perspective on how Cramo Oyj is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its trade distributors industry peers. See our latest analysis for Cramo Oyj
Were CRA1V’s earnings stronger than its past performances and the industry?
I look at 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 enables me to assess various companies on a similar basis, using the most relevant data points. For Cramo Oyj, its most recent trailing-twelve-month earnings is €84.25M, which, against last year’s level, has climbed up by 22.87%. Given that these values may be somewhat short-term thinking, I have calculated an annualized five-year value for Cramo Oyj’s earnings, which stands at €41.81M This means that, on average, Cramo Oyj has been able to consistently grow its profits over the past couple of years as well.
How has it been able to do this? Well, let’s take a look at if it is merely owing to an industry uplift, or if Cramo Oyj has experienced some company-specific growth. Over the last few years, Cramo Oyj increased its bottom line faster than revenue by efficiently controlling its costs. This has led to a margin expansion and profitability over time. Scanning growth from a sector-level, the FI trade distributors industry has been growing its average earnings by double-digit 18.43% over the prior twelve months, and a more muted 5.74% over the previous five years. This means that any uplift the industry is deriving benefit from, Cramo Oyj is capable of leveraging this to its advantage.
What does this mean?
Cramo Oyj’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Positive growth and profitability are what investors like to see in a company’s track record, but how do we properly assess sustainability? I recommend you continue to research Cramo Oyj to get a better picture of the stock by looking at:
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1. Future Outlook: What are well-informed industry analysts predicting for CRA1V’s future growth? Take a look at our free research report of analyst consensus for CRA1V’s outlook.
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2. Financial Health: Is CRA1V’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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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 31 December 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.