Assessing SG Fleet Group Limited’s (ASX:SGF) past track record of performance is a valuable exercise for investors. It enables us to reflect on whether the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess SGF’s recent performance announced on 31 December 2018 and evaluate these figures to its longer term trend and industry movements.
How Well Did SGF Perform?
SGF’s trailing twelve-month earnings (from 31 December 2018) of AU$66m has increased by 1.7% 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 12%, indicating the rate at which SGF is growing has slowed down. Why could this be happening? Well, let’s look at what’s occurring with margins and if the rest of the industry is feeling the heat.
In terms of returns from investment, SG Fleet Group 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 11% exceeds the AU Commercial Services industry of 4.8%, indicating SG Fleet Group has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for SG Fleet Group’s debt level, has increased over the past 3 years from 15% to 18%.
What does this mean?
Though SG Fleet Group’s past data is helpful, it is only one aspect of my investment thesis. While SG Fleet Group has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. I suggest you continue to research SG Fleet Group to get a more holistic view of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for SGF’s future growth? Take a look at our free research report of analyst consensus for SGF’s outlook.
- Financial Health: Are SGF’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 31 December 2018. 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 email@example.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.