Assessing O2 Czech Republic a.s.'s (SEP:TELEC) 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 TELEC's recent performance announced on 31 December 2019 and evaluate these figures to its long-term trend and industry movements.
Check out our latest analysis for O2 Czech Republic
How Well Did TELEC Perform?
TELEC's trailing twelve-month earnings (from 31 December 2019) of Kč5.5b has increased by 0.2% 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 5.2%, indicating the rate at which TELEC is growing has slowed down. What could be happening here? Well, let's examine what's going on with margins and if the whole industry is feeling the heat.
In terms of returns from investment, O2 Czech Republic has invested its equity funds well leading to a 39% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 14% exceeds the CZ Telecom industry of 5.1%, indicating O2 Czech Republic has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for O2 Czech Republic’s debt level, has increased over the past 3 years from 28% to 29%.
What does this mean?
O2 Czech Republic'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 O2 Czech Republic gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I suggest you continue to research O2 Czech Republic to get a more holistic view of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for TELEC’s future growth? Take a look at our free research report of analyst consensus for TELEC’s outlook.
- Financial Health: Are TELEC’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 2019. This may not be consistent with full year annual report figures.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.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.
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. Thank you for reading.
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