Assessing Cellnet Group Limited’s (ASX:CLT) 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 CLT’s recent performance announced on 31 December 2017 and evaluate these figures to its long-term trend and industry movements. View our latest analysis for Cellnet Group
How Well Did CLT Perform?
I like to 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 technique enables me to examine various companies in a uniform manner using new information. For Cellnet Group, its most recent trailing-twelve-month earnings is AU$2.76M, which, against last year’s level, has increased by a significant 72.75%. Since these values may be somewhat nearsighted, I have estimated an annualized five-year value for CLT’s net income, which stands at AU$711.84K This means generally, Cellnet Group has been able to increasingly raise its earnings over the last couple of years as well.How has it been able to do this? Well, let’s take a look at whether it is merely a result of an industry uplift, or if Cellnet Group has experienced some company-specific growth. Over the past few years, Cellnet Group expanded its bottom line faster than revenue by efficiently controlling its costs. This brought about a margin expansion and profitability over time. Scanning growth from a sector-level, the Australian electronic industry has been growing its average earnings by double-digit 45.08% over the previous twelve months, and 24.37% over the last five years. This means whatever uplift the industry is gaining from, Cellnet Group is able to leverage this to its advantage.
What does this mean?
Cellnet Group’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 Cellnet Group gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I suggest you continue to research Cellnet Group to get a more holistic view of the stock by looking at:
- 1. Financial Health: Is CLT’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. Valuation: What is CLT 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 CLT is currently mispriced by the market.
- 3. 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.