Interested In IMI plc (LON:IMI)? Here's What Its Recent Performance Looks Like

When IMI plc (LSE:IMI) announced its most recent earnings (30 June 2019), I compared it against two factor: its historical earnings track record, and the performance of its industry peers on average. Being able to interpret how well IMI has done so far requires weighing its performance against a benchmark, rather than looking at a standalone number at a point in time. In this article, I've summarized the key takeaways on how I see IMI has performed.

View our latest analysis for IMI

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

IMI's trailing twelve-month earnings (from 30 June 2019) of UK£169m has jumped 16% compared to the previous year.

Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of -1.3%, indicating the rate at which IMI is growing has accelerated. How has it been able to do this? Well, let’s take a look at if it is solely owing to an industry uplift, or if IMI has experienced some company-specific growth.

In terms of returns from investment, IMI has invested its equity funds well leading to a 25% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 9.7% exceeds the GB Machinery industry of 7.3%, indicating IMI has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for IMI’s debt level, has increased over the past 3 years from 21% to 22%.

What does this mean?

IMI's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. While IMI has a good historical track record with positive growth and profitability, there's no certainty that this will extrapolate into the future. You should continue to research IMI to get a better picture of the stock by looking at:

1. Future Outlook: What are well-informed industry analysts predicting for IMI’s future growth? Take a look at our free research report of analyst consensus for IMI’s outlook.
2. Financial Health: Are IMI’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 June 2019. This may not be consistent with full year annual report figures.

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.

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. Thank you for reading.