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Examining Currency Exchange International, Corp.’s (TSE:CXI) 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 CXI’s latest performance announced on 31 October 2018 and compare these figures to its longer term trend and industry movements.
View our latest analysis for Currency Exchange International
Were CXI’s earnings stronger than its past performances and the industry?
CXI’s trailing twelve-month earnings (from 31 October 2018) of US$4.2m has jumped 11% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 5.3%, indicating the rate at which CXI is growing has accelerated. What’s the driver of this growth? Let’s see if it is only owing to industry tailwinds, or if Currency Exchange International has experienced some company-specific growth.
In terms of returns from investment, Currency Exchange International has fallen short of achieving a 20% return on equity (ROE), recording 6.7% instead. However, its return on assets (ROA) of 6.3% exceeds the CA Consumer Finance industry of 4.8%, indicating Currency Exchange International has used its assets more efficiently. Though, its return on capital (ROC), which also accounts for Currency Exchange International’s debt level, has declined over the past 3 years from 12% to 12%.
What does this mean?
Currency Exchange International’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Positive growth and profitability are what investors like to see in a company’s track record, but how do we properly assess sustainability? I suggest you continue to research Currency Exchange International to get a more holistic view of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for CXI’s future growth? Take a look at our free research report of analyst consensus for CXI’s outlook.
- Financial Health: Are CXI’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 October 2018. This may not be consistent with full year annual report figures.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.