Assessing Robert Walters plc’s (LON:RWA) past track record of performance is a useful exercise for investors. It allows us to understand whether the company has met or exceed expectations, which is a great indicator for future performance. Below, I assess RWA’s latest performance announced on 30 June 2019 and evaluate these figures to its historical trend and industry movements.
See our latest analysis for Robert Walters
How Well Did RWA Perform?
RWA’s trailing twelve-month earnings (from 30 June 2019) of UK£36m has increased by 7.1% 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 28%, indicating the rate at which RWA is growing has slowed down. What could be happening here? Well, let’s examine what’s transpiring with margins and whether the whole industry is feeling the heat.
In terms of returns from investment, Robert Walters has invested its equity funds well leading to a 24% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 8.6% exceeds the GB Professional Services industry of 8.3%, indicating Robert Walters has used its assets more efficiently. However, its return on capital (ROC), which also accounts for Robert Walters’s debt level, has declined over the past 3 years from 25% to 24%. This correlates with an increase in debt holding, with debt-to-equity ratio rising from 1.0% to 19% over the past 5 years.
What does this mean?
Though Robert Walters’s past data is helpful, it is only one aspect of my investment thesis. Companies that have performed well in the past, such as Robert Walters gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I recommend you continue to research Robert Walters to get a more holistic view of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for RWA’s future growth? Take a look at our free research report of analyst consensus for RWA’s outlook.
- Financial Health: Are RWA’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.
- 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 June 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.