Where Macfarlane Group PLC (LON:MACF) Stands In Terms Of Earnings Growth Against Its Industry
Analyzing Macfarlane Group PLC's (LON:MACF) track record of past performance is a valuable exercise for investors. It enables us to reflect on whether or not the company has met expectations, which is a powerful signal for future performance. Today I will assess MACF's recent performance announced on 31 December 2018 and compare these figures to its long-term trend and industry movements.
Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
View our latest analysis for Macfarlane Group
How Well Did MACF Perform?
MACF's trailing twelve-month earnings (from 31 December 2018) of UK£8.7m has jumped 18% 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 18%, indicating the rate at which MACF is growing has slowed down. To understand what's happening, let's examine what's going on with margins and whether the whole industry is facing the same headwind.
In terms of returns from investment, Macfarlane Group has fallen short of achieving a 20% return on equity (ROE), recording 14% instead. Furthermore, its return on assets (ROA) of 6.5% is below the GB Trade Distributors industry of 6.9%, indicating Macfarlane Group's are utilized less efficiently. However, its return on capital (ROC), which also accounts for Macfarlane Group’s debt level, has increased over the past 3 years from 16% to 16%.
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 recommend you continue to research Macfarlane Group to get a better picture of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for MACF’s future growth? Take a look at our free research report of analyst consensus for MACF’s outlook.
- Financial Health: Are MACF’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 2018. 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.