In this article, I will take a look at Oryx Petroleum Corporation Limited’s (TSX:OXC) most recent earnings update (31 March 2018) and compare these latest figures against its performance over the past few years, along with how the rest of OXC’s industry performed. As a long-term investor, I find it useful to analyze the company’s trend over time in order to estimate whether or not the company is able to meet its goals, and eventually grow sustainably over time. See our latest analysis for Oryx Petroleum
How Well Did OXC Perform?
I use data from the most recent 12 months, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This method allows me to examine many different companies on a similar basis, using new information. For Oryx Petroleum, its latest trailing-twelve-month earnings is -US$47.44M, which, in comparison to last year’s figure, has become more negative. Since these values may be relatively myopic, I’ve determined an annualized five-year value for Oryx Petroleum’s net income, which stands at -US$130.37M. This shows that, though net income is negative, it has become less negative over the years.We can further assess Oryx Petroleum’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past five years Oryx Petroleum’s top-line has increased by 24.98% on average, signalling that the company is in a high-growth period with expenses racing ahead revenues, leading to annual losses. Inspecting growth from a sector-level, the Canadian oil and gas industry has been ramping up average earnings growth of 73.80% over the prior twelve months, and a flatter 0.86% over the past half a decade. This suggests that any tailwind the industry is enjoying, Oryx Petroleum has not been able to leverage it as much as its average peer.
What does this mean?
Oryx Petroleum’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Companies that incur net loss is always difficult to envisage what will happen in the future and when. The most insightful step is to assess company-specific issues Oryx Petroleum may be facing and whether management guidance has steadily been met in the past. You should continue to research Oryx Petroleum to get a more holistic view of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for OXC’s future growth? Take a look at our free research report of analyst consensus for OXC’s outlook.
- Financial Health: Is OXC’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.