Today I will examine Sing Investments & Finance Limited’s (SGX:S35) latest earnings update (30 September 2017) and compare these figures against its performance over the past couple of years, in addition to how the rest of S35’s industry performed. As a long-term investor, I find it useful to analyze the company’s trend over time in order to estimate whether or not the company is able to meet its goals, and eventually grow sustainably over time. View our latest analysis for Sing Investments & Finance
How Well Did S35 Perform?
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 blend enables me to analyze many different companies in a uniform manner using new information. For Sing Investments & Finance, its most recent earnings (trailing twelve month) is SGD21.0M, which, in comparison to the previous year’s level, has risen by a substantial 52.88%. Given that these values are fairly short-term, I have computed an annualized five-year value for S35’s net income, which stands at SGD15.8M. This means that, on average, Sing Investments & Finance has been able to increasingly improve its earnings over the past few years as well.
What’s enabled this growth? Let’s see if it is only because of an industry uplift, or if Sing Investments & Finance has seen some company-specific growth. Even though both top-line and bottom-line growth rates in the past couple of years, were, on average, negative, earnings were more so. While this resulted in a margin contraction, it has cushioned Sing Investments & Finance’s earnings contraction. Looking at growth from a sector-level, the SG consumer finance industry has been growing its average earnings by double-digit 15.90% in the past twelve months, and a more muted 7.47% over the previous five years. This means whatever tailwind the industry is enjoying, Sing Investments & Finance is able to leverage this to its advantage.
What does this mean?
Sing Investments & Finance’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Companies that have performed well in the past, such as Sing Investments & Finance gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I recommend you continue to research Sing Investments & Finance to get a better picture of the stock by looking at: