In This Article:
Assessing Dream International Limited’s (HKG:1126) past track record of performance is a useful exercise for investors. It allows us to understand whether the company has met or exceed expectations, which is a great indicator for future performance. Below, I assess 1126’s latest performance announced on 30 June 2018 and evaluate these figures to its historical trend and industry movements.
View our latest analysis for Dream International
Did 1126 beat its long-term earnings growth trend and its industry?
1126’s trailing twelve-month earnings (from 30 June 2018) of HK$367m has increased by 9.3% compared to the previous year.
However, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 30%, indicating the rate at which 1126 is growing has slowed down. To understand what’s happening, let’s examine what’s transpiring with margins and whether the whole industry is experiencing the hit as well.
In terms of returns from investment, Dream International has invested its equity funds well leading to a 20% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 14% exceeds the HK Leisure industry of 8.4%, indicating Dream International has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Dream International’s debt level, has increased over the past 3 years from 16% to 26%.
What does this mean?
While past data is useful, it doesn’t tell the whole story. While Dream International has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. I recommend you continue to research Dream International to get a more holistic view of the stock by looking at:
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Future Outlook: What are well-informed industry analysts predicting for 1126’s future growth? Take a look at our free research report of analyst consensus for 1126’s outlook.
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Financial Health: Are 1126’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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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 2018. This may not be consistent with full year annual report figures.
To help readers see past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.