Measuring Apar Industries Limited’s (NSE:APARINDS) track record of past performance is a useful exercise for investors. It enables us to understand whether or not the company has met or exceed expectations, which is an insightful signal for future performance. Today I will assess APARINDS’s recent performance announced on 30 September 2018 and weigh these figures against its long-term trend and industry movements.

View our latest analysis for Apar Industries

Did APARINDS perform worse than its track record and industry?

APARINDS’s trailing twelve-month earnings (from 30 September 2018) of US$1.4b has declined by -7.7% 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 15%, indicating the rate at which APARINDS is growing has slowed down. Why is this? Let’s examine what’s transpiring with margins and whether the rest of the industry is experiencing the hit as well.

In terms of returns from investment, Apar Industries has fallen short of achieving a 20% return on equity (ROE), recording 12% instead. Furthermore, its return on assets (ROA) of 5.8% is below the IN Industrials industry of 6.3%, indicating Apar Industries’s are utilized less efficiently. However, its return on capital (ROC), which also accounts for Apar Industries’s debt level, has increased over the past 3 years from 29% to 29%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 141% to 34% over the past 5 years.

What does this mean?

While past data is useful, it doesn’t tell the whole story. Companies that are profitable, but have volatile earnings, can have many factors influencing its business. You should continue to research Apar Industries to get a better picture of the stock by looking at:

1. Future Outlook: What are well-informed industry analysts predicting for APARINDS’s future growth? Take a look at our free research report of analyst consensus for APARINDS’s outlook.

2. Financial Health: Are APARINDS’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.

3. 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 30 September 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.