Today I will take a look at Koda Ltd’s (SGX:BJZ) most recent earnings update (31 December 2017) and compare these latest figures against its performance over the past few years, as well as how the rest of the consumer durables industry performed. As an investor, I find it beneficial to assess BJZ’s trend over the short-to-medium term in order to gauge whether or not the company is able to meet its goals, and ultimately sustainably grow over time. Check out our latest analysis for Koda

How Did BJZ’s Recent Performance Stack Up Against Its Past?

For the purpose of this commentary, I like to 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 method allows me to analyze many different companies on a more comparable basis, using new information. For Koda, its latest earnings (trailing twelve month) is US$4.55M, which compared to last year’s figure, has rocketed up by more than double. Since these values are relatively nearsighted, I have created an annualized five-year value for BJZ’s earnings, which stands at US$9.57K This means on average, Koda has been able to steadily grow its profits over the last few years as well.

What’s the driver of this growth? Let’s see whether it is solely due to industry tailwinds, or if Koda has experienced some company-specific growth. Over the past couple of years, Koda expanded its bottom line faster than revenue by successfully controlling its costs. This brought about a margin expansion and profitability over time. Inspecting growth from a sector-level, the SG consumer durables industry has been growing its average earnings by double-digit 12.49% over the previous twelve months, and 13.61% over the previous five years. This means whatever uplift the industry is deriving benefit from, Koda is able to leverage this to its advantage.

What does this mean?

While past data is useful, it doesn’t tell the whole story. Companies that have performed well in the past, such as Koda gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I recommend you continue to research Koda to get a better picture of the stock by looking at the areas below. Just a heads up – to access some parts of the Simply Wall St research tool you might be asked to create a free account, but it takes just one click and the information they provide is definitely worth it in my opinion.

• 1. Financial Health: Is BJZ’s operations financially sustainable? Balance sheets can be hard to analyze, which is why Simply Wall St does it for you. Check out important financial health checks here.

• 2. Valuation: What is BJZ worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in this free research report helps visualize whether BJZ is currently mispriced by the market.

• 3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore a free list of these great stocks here.

NB: Figures in this article are calculated using data from the trailing twelve months from 31 December 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.