Examining INSCAPE Corporation’s (TSX:INQ) past track record of performance is an insightful exercise for investors. It allows us to reflect on whether or not the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess INQ’s latest performance announced on 31 July 2017 and compare these figures to its longer term trend and industry movements. See our latest analysis for INQ
How Did INQ’s Recent Performance Stack Up Against Its Past?
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 analyze many different companies in a uniform manner using the most relevant data points. For INSCAPE, the latest earnings is CA$4M, which compared to the previous year’s level, has increased by an impressive 94.96%. Since these figures may be fairly myopic, I’ve estimated an annualized five-year value for INQ’s net income, which stands at -CA$3M. This means generally, INSCAPE has been able to increasingly grow its bottom line over the last few years as well.What’s enabled this growth? Let’s take a look at whether it is solely owing to an industry uplift, or if INSCAPE has experienced some company-specific growth. Over the past couple of years, INSCAPE top-line expansion has outpaced earnings and the growth rate of expenses. Though this has caused a margin contraction, it has softened INSCAPE’s earnings contraction. Inspecting growth from a sector-level, the Canadian commercial services and supplies industry has been enduring severe headwinds over the previous twelve months, leading to an average earnings drop of -62.81%. This is a major change, given that the industry has been delivering a positive rate of 6.61%, on average, over the previous five years. This suggests that any near-term headwind the industry is experiencing, INSCAPE is less exposed compared to its peers.
What does this mean?
INSCAPE’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 INSCAPE gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I recommend you continue to research INSCAPE to get a better picture of the stock by looking at:
1. Financial Health: Is INQ’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.