When Rockwell Medical Inc (NASDAQ:RMTI) released its most recent earnings update (30 September 2017), I compared it against two factor: its historical earnings track record, and the performance of its industry peers on average. Understanding how Rockwell Medical performed requires a benchmark rather than trying to assess a standalone number at one point in time. Below is a quick commentary on how I see RMTI has performed. See our latest analysis for Rockwell Medical

How Well Did RMTI Perform?

For the most up-to-date info, I 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 blend enables me to examine different companies on a more comparable basis, using new information. For Rockwell Medical, its latest earnings (trailing twelve month) is -US$21.94M, which, in comparison to last year’s figure, has become more negative. Given that these values may be fairly nearsighted, I have calculated an annualized five-year value for RMTI’s earnings, which stands at -US$28.11M. This suggests that, although net income is negative, it has become less negative over the years.

We can further examine Rockwell Medical’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past half a decade Rockwell Medical’s revenue growth has been fairly subdued, with an annual growth rate of 1.39%, on average. The company’s inability to breakeven has been aided by the relatively flat top-line in the past. Looking at growth from a sector-level, the US medical equipment industry has been growing its average earnings by double-digit 10.69% over the prior year, and a more subdued 9.16% over the past half a decade. This shows that whatever tailwind the industry is profiting from, Rockwell Medical has not been able to leverage it as much as its average peer.

What does this mean?

Though Rockwell Medical’s past data is helpful, it is only one aspect of my investment thesis. Companies that incur net loss is always hard to envisage what will occur going forward, and when. The most insightful step is to examine company-specific issues Rockwell Medical may be facing and whether management guidance has consistently been met in the past. I suggest you continue to research Rockwell Medical 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.