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Assessing Internet Union S.A.'s (WSE:IUS) past track record of performance is a valuable exercise for investors. It enables us to reflect on whether the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess IUS's recent performance announced on 31 March 2019 and evaluate these figures to its longer term trend and industry movements.
View our latest analysis for Internet Union
Was IUS weak performance lately part of a long-term decline?
IUS's trailing twelve-month earnings (from 31 March 2019) of zł396k has declined by -20% compared to the previous year.
Furthermore, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of -8.2%, indicating the rate at which IUS is growing has slowed down. What could be happening here? Well, let's look at what's going on with margins and whether the rest of the industry is experiencing the hit as well.
In terms of returns from investment, Internet Union has fallen short of achieving a 20% return on equity (ROE), recording 5.8% instead. However, its return on assets (ROA) of 4.0% exceeds the PL Telecom industry of 2.0%, indicating Internet Union has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Internet Union’s debt level, has increased over the past 3 years from 4.0% to 5.0%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 58% to 28% over the past 5 years.
What does this mean?
Though Internet Union's past data is helpful, it is only one aspect of my investment thesis. Typically companies that endure an extended period of diminishing earnings are going through some sort of reinvestment phase in order to keep up with the recent industry growth and disruption. You should continue to research Internet Union 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 IUS’s future growth? Take a look at our free research report of analyst consensus for IUS’s outlook.
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Financial Health: Are IUS’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.