For investors with a long-term horizon, assessing earnings trend over time and against industry benchmarks is more valuable than looking at a single earnings announcement in one point in time. Investors may find my commentary, albeit very high-level and brief, on AMVIG Holdings Limited (SEHK:2300) useful as an attempt to give more color around how AMVIG Holdings is currently performing.
See our latest analysis for AMVIG Holdings
How Well Did 2300 Perform?
2300's trailing twelve-month earnings (from 31 December 2019) of HK$313m has jumped 18% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of -0.6%, indicating the rate at which 2300 is growing has accelerated. How has it been able to do this? Let's see if it is only attributable to an industry uplift, or if AMVIG Holdings has experienced some company-specific growth.
In terms of returns from investment, AMVIG Holdings has fallen short of achieving a 20% return on equity (ROE), recording 9.0% instead. However, its return on assets (ROA) of 5.9% exceeds the HK Packaging industry of 5.0%, indicating AMVIG Holdings has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for AMVIG Holdings’s debt level, has increased over the past 3 years from 8.7% to 10%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 65% to 38% over the past 5 years.
What does this mean?
AMVIG Holdings's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. Companies that have performed well in the past, such as AMVIG Holdings gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I recommend you continue to research AMVIG Holdings to get a better picture of the stock by looking at:
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Financial Health: Are 2300’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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Valuation: What is 2300 worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether 2300 is currently mispriced by the market.
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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 December 2019. This may not be consistent with full year annual report figures.
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.
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. Thank you for reading.