Examining how Cesca Therapeutics Inc (NASDAQ:KOOL) is performing as a company requires looking at more than just a years’ earnings. Below, I will run you through a simple sense check to build perspective on how Cesca Therapeutics is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its healthcare equipment and supplies industry peers. View our latest analysis for Cesca Therapeutics
Did KOOL beat its long-term earnings growth trend and its industry?
For the most up-to-date info, I use data from the most recent 12 months, which annualizes the most recent half-year data, or in some cases, the latest annual report is already the most recent financial year data. This allows me to assess different companies on a more comparable basis, using the most relevant data points. For Cesca Therapeutics, the most recent twelve-month earnings -$9M, which, in comparison to the previous year’s level, has become less negative. Given that these values may be relatively short-term, I have determined an annualized five-year value for KOOL’s earnings, which stands at -$12M. This means although net income is negative, it has become less negative over the years.We can further examine Cesca Therapeutics’s loss by researching what has been happening in the industry along with within the company. Firstly, I want to briefly look into the line items. Revenue growth over past few years has been negative at -9.22%. The key to profitability here is to make sure the company’s cost growth is well-managed. Inspecting growth from a sector-level, the US healthcare equipment and supplies industry has been growing its average earnings by double-digit 15.51% over the prior year, and a less exciting 8.10% over the previous five years. This means while Cesca Therapeutics is currently unprofitable, it may have benefited from industry tailwinds, moving earnings in the right direction.
What does this mean?
Though Cesca Therapeutics’s past data is helpful, it is only one aspect of my investment thesis. With companies that are currently loss-making, it is always difficult to forecast what will happen in the future and when. The most insightful step is to assess company-specific issues Cesca Therapeutics may be facing and whether management guidance has regularly been met in the past. You should continue to research Cesca Therapeutics to get a better picture of the stock by looking at:
1. Financial Health: Is KOOL’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.
2. 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 last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.