In This Article:
When Miko NV (EBR:MIKO) released its most recent earnings update (31 December 2018), I wanted to understand how these figures stacked up against its past performance. The two benchmarks I used were Miko's average earnings over the past couple of years, and its industry performance. These are useful yardsticks to help me gauge whether or not MIKO actually performed well. Below is a quick commentary on how I see MIKO has performed.
View our latest analysis for Miko
Was MIKO's weak performance lately a part of a long-term decline?
MIKO's trailing twelve-month earnings (from 31 December 2018) of €9.2m has declined by -18% 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 9.6%, indicating the rate at which MIKO is growing has slowed down. Why is this? Well, let's look at what's occurring with margins and whether the entire industry is experiencing the hit as well.
In terms of returns from investment, Miko has fallen short of achieving a 20% return on equity (ROE), recording 10% instead. However, its return on assets (ROA) of 4.7% exceeds the BE Food industry of 3.1%, indicating Miko has used its assets more efficiently. Though, its return on capital (ROC), which also accounts for Miko’s debt level, has declined over the past 3 years from 9.2% to 8.9%. This correlates with an increase in debt holding, with debt-to-equity ratio rising from 30% to 71% over the past 5 years.
What does this mean?
Though Miko's past data is helpful, it is only one aspect of my investment thesis. Companies that are profitable, but have unpredictable earnings, can have many factors affecting its business. You should continue to research Miko to get a more holistic view of the stock by looking at:
-
Future Outlook: What are well-informed industry analysts predicting for MIKO’s future growth? Take a look at our free research report of analyst consensus for MIKO’s outlook.
-
Financial Health: Are MIKO’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.
-
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 December 2018. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.