Assessing Suda Pharmaceuticals Ltd’s (ASX:SUD) performance as a company requires looking at more than just a years’ earnings data. Below, I will run you through a simple sense check to build perspective on how Suda Pharmaceuticals is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its pharmaceuticals industry peers. View our latest analysis for Suda Pharmaceuticals

Commentary On SUD’s Past Performance

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 technique enables me to assess different stocks on a similar basis, using the most relevant data points. For Suda Pharmaceuticals, its most recent bottom-line (trailing twelve month) is -AU$2.52M, which, in comparison to last year’s figure, has become more negative. Given that these values may be somewhat short-term, I’ve estimated an annualized five-year value for Suda Pharmaceuticals’s earnings, which stands at -AU$2.81M. This suggests that, even though net income is negative, it has become less negative over the years.

We can further assess Suda Pharmaceuticals’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the last five years Suda Pharmaceuticals’s top-line has grown by a mere 6.94%, on average. The company’s inability to breakeven has been aided by the relatively flat top-line in the past. Eyeballing growth from a sector-level, the Australian pharmaceuticals industry has been enduring some headwinds over the previous twelve months, leading to an average earnings drop of -14.05%. This is a significant change, given that the industry has been delivering a positive rate of 3.11%, on average, over the past half a decade. This suggests that whatever recent headwind the industry is facing, it’s hitting Suda Pharmaceuticals harder than its peers.

What does this mean?

Suda Pharmaceuticals’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Companies that incur net loss is always hard to forecast what will occur going forward, and when. The most useful step is to examine company-specific issues Suda Pharmaceuticals may be facing and whether management guidance has regularly been met in the past. I recommend you continue to research Suda Pharmaceuticals to get a better picture of the stock by looking at: