For investors, increase in profitability and industry-beating performance can be essential considerations in an investment. Below, I will examine Pegasus Entertainment Holdings Limited’s (SEHK:1326) track record on a high level, to give you some insight into how the company has been performing against its long term trend and its industry peers. Check out our latest analysis for Pegasus Entertainment Holdings
Could 1326 beat the long-term trend and outperform its industry?
To account for any quarterly or half-yearly updates, I use 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 technique enables me to assess various companies on a more comparable basis, using the most relevant data points. For Pegasus Entertainment Holdings, its most recent bottom-line (trailing twelve month) is -HK$40.0M, which, against the previous year’s level, has become less negative. Given that these figures may be somewhat short-term thinking, I’ve estimated an annualized five-year figure for 1326’s net income, which stands at -HK$42.9M. This shows that, although net income is negative, it has become less negative over the years.
We can further examine Pegasus Entertainment Holdings’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past five years Pegasus Entertainment Holdings’s top-line has increased by 21.55% on average, indicating that the company is in a high-growth phase with expenses shooting ahead of revenues, leading to annual losses. Viewing growth from a sector-level, the HK media industry has been relatively flat in terms of earnings growth . Thought this is a bit of a change from a volatile drop of -15.73% in the last few years. This shows that even though Pegasus Entertainment Holdings is currently running a loss, any near-term headwind the industry is facing, the impact on Pegasus Entertainment Holdings has been softer relative to its peers.
What does this mean?
Pegasus Entertainment Holdings’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Companies that incur net loss is always difficult to envisage what will happen in the future and when. The most useful step is to examine company-specific issues Pegasus Entertainment Holdings may be facing and whether management guidance has steadily been met in the past. I recommend you continue to research Pegasus Entertainment Holdings to get a more holistic view of the stock by looking at: