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For investors with a long-term horizon, assessing earnings trend over time and against industry benchmarks is more valuable than looking at a single earnings announcement in one point in time. Investors may find my commentary, albeit very high-level and brief, on Siyaram Silk Mills Limited (NSE:SIYSIL) useful as an attempt to give more color around how Siyaram Silk Mills is currently performing.
Check out our latest analysis for Siyaram Silk Mills
How Did SIYSIL’s Recent Performance Stack Up Against Its Past?
SIYSIL’s trailing twelve-month earnings (from 31 March 2018) of ₹1.1b has jumped 22% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 13%, indicating the rate at which SIYSIL is growing has accelerated. What’s enabled this growth? Let’s take a look at if it is solely because of industry tailwinds, or if Siyaram Silk Mills has seen some company-specific growth.
In terms of returns from investment, Siyaram Silk Mills has fallen short of achieving a 20% return on equity (ROE), recording 16% instead. However, its return on assets (ROA) of 8.3% exceeds the IN Luxury industry of 5.8%, indicating Siyaram Silk Mills has used its assets more efficiently. Though, its return on capital (ROC), which also accounts for Siyaram Silk Mills’s debt level, has declined over the past 3 years from 25% to 22%.
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? You should continue to research Siyaram Silk Mills 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 SIYSIL’s future growth? Take a look at our free research report of analyst consensus for SIYSIL’s outlook.
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Financial Health: Are SIYSIL’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 31 March 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.