In This Article:
Understanding how Everest Industries Limited (NSE:EVERESTIND) is performing as a company requires looking at more than just a years' earnings. Today I will run you through a basic sense check to gain perspective on how Everest Industries is doing by comparing its latest earnings with its long-term trend as well as the performance of its building industry peers.
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Check out our latest analysis for Everest Industries
Did EVERESTIND's recent earnings growth beat the long-term trend and the industry?
EVERESTIND's trailing twelve-month earnings (from 31 March 2019) of ₹619m has jumped 17% compared to the previous year.
However, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 25%, indicating the rate at which EVERESTIND is growing has slowed down. To understand what's happening, let’s take a look at what’s going on with margins and if the whole industry is facing the same headwind.
In terms of returns from investment, Everest Industries has fallen short of achieving a 20% return on equity (ROE), recording 14% instead. However, its return on assets (ROA) of 7.7% exceeds the IN Building industry of 6.3%, indicating Everest Industries has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Everest Industries’s debt level, has increased over the past 3 years from 13% to 16%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 83% to 18% over the past 5 years.
What does this mean?
While past data is useful, it doesn’t tell the whole story. While Everest Industries has a good historical track record with positive growth and profitability, there's no certainty that this will extrapolate into the future. You should continue to research Everest Industries 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 EVERESTIND’s future growth? Take a look at our free research report of analyst consensus for EVERESTIND’s outlook.
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Financial Health: Are EVERESTIND’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.
NB: Figures in this article are calculated using data from the trailing twelve months from 31 March 2019. 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.