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Analyzing Man Wah Holdings Limited’s (SEHK:1999) track record of past performance is a valuable exercise for investors. It enables us to reflect on whether or not the company has met expectations, which is a powerful signal for future performance. Today I will assess 1999’s recent performance announced on 30 September 2017 and compare these figures to its long-term trend and industry movements. See our latest analysis for Man Wah Holdings
How Did 1999’s Recent Performance Stack Up Against Its Past?
I use data from the most recent 12 months, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This allows me to analyze different stocks on a more comparable basis, using the most relevant data points. For Man Wah Holdings, its most recent trailing-twelve-month earnings is HK$1.66B, which, against last year’s figure, has risen by a somewhat muted 4.06%. Since these figures may be relatively short-term thinking, I have estimated an annualized five-year value for 1999’s earnings, which stands at HK$983.89M This shows that, generally, Man Wah Holdings has been able to steadily grow its profits over the last couple of years as well.
What’s the driver of this growth? Well, let’s take a look at whether it is merely because of industry tailwinds, or if Man Wah Holdings has experienced some company-specific growth. In the last few years, Man Wah Holdings expanded its bottom line faster than revenue by effectively controlling its costs. This has caused a margin expansion and profitability over time. Inspecting growth from a sector-level, the HK consumer durables industry has been growing its average earnings by double-digit 20.57% over the previous twelve months, and 12.42% over the past five. This shows that whatever tailwind the industry is profiting from, Man Wah Holdings has not been able to gain as much as its industry peers.
What does this mean?
Though Man Wah Holdings’s past data is helpful, it is only one aspect of my investment thesis. Companies that have performed well in the past, such as Man Wah Holdings gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I suggest you continue to research Man Wah Holdings 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 1999’s future growth? Take a look at our free research report of analyst consensus for 1999’s outlook.
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Financial Health: Is 1999’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 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.