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When First Sponsor Group Limited (SGX:ADN) released its most recent earnings update (30 September 2019), I compared it against two factor: its historical earnings track record, and the performance of its industry peers on average. Understanding how First Sponsor Group performed requires a benchmark rather than trying to assess a standalone number at one point in time. Below is a quick commentary on how I see ADN has performed.
See our latest analysis for First Sponsor Group
How ADN fared against its long-term earnings performance and its industry
ADN's trailing twelve-month earnings (from 30 September 2019) of S$127m has jumped 34% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 22%, indicating the rate at which ADN is growing has accelerated. What's enabled this growth? Let's see whether it is only a result of industry tailwinds, or if First Sponsor Group has experienced some company-specific growth.
In terms of returns from investment, First Sponsor Group has fallen short of achieving a 20% return on equity (ROE), recording 8.9% instead. However, its return on assets (ROA) of 4.4% exceeds the SG Real Estate industry of 3.1%, indicating First Sponsor Group has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for First Sponsor Group’s debt level, has increased over the past 3 years from 6.3% to 7.8%.
What does this mean?
While past data is useful, it 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 suggest you continue to research First Sponsor Group to get a better picture of the stock by looking at:
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Future Outlook: What are well-informed industry analysts predicting for ADN’s future growth? Take a look at our free research report of analyst consensus for ADN’s outlook.
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Financial Health: Are ADN’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 September 2019. This may not be consistent with full year annual report figures.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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