How Q-Soft Verwaltungs AG's (BST:QS6A) Earnings Growth Stacks Up Against The Industry

For long term investors, improvement in profitability and outperformance against the industry can be important characteristics in a stock. In this article, I will take a look at Q-Soft Verwaltungs AG's (BST:QS6A) track record on a high level, to give you some insight into how the company has been performing against its historical trend and its industry peers. Check out our latest analysis for Q-Soft Verwaltungs

Did QS6A's recent earnings growth beat the long-term trend and the industry?

QS6A recently turned a profit of €164.60k (most recent trailing twelve-months) compared to its average loss of -€16.95k over the past five years.

Scanning growth from a sector-level, the DE software industry has been growing its average earnings by double-digit 13.98% over the previous twelve months, and 11.16% over the past half a decade. This growth is a median of profitable companies of 25 Software companies in DE including GBS Software, RealDolmen and NetSol Technologies. This means any tailwind the industry is benefiting from, Q-Soft Verwaltungs is capable of amplifying this to its advantage.

In terms of returns from investment, Q-Soft Verwaltungs has not invested its equity funds well, leading to a 9.18% return on equity (ROE), below the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 0.32% is below the DE Software industry of 7.29%, indicating Q-Soft Verwaltungs's are utilized less efficiently. However, its return on capital (ROC), which also accounts for Q-Soft Verwaltungs’s debt level, has increased over the past 3 years from 0.036% to 9.03%.

What does this mean?

While past data is useful, it 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 Q-Soft Verwaltungs to get a more holistic view of the stock by looking at:

1. Future Outlook: What are well-informed industry analysts predicting for QS6A’s future growth? Take a look at our free research report of analyst consensus for QS6A’s outlook.
2. Financial Health: Is QS6A’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.
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.

NB: Figures in this article are calculated using data from the trailing twelve months from 30 September 2017. This may not be consistent with full year annual report figures.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.