Did Haier Electronics Group Co., Ltd.'s (HKG:1169) Recent Earnings Growth Beat The Trend?

For investors with a long-term horizon, assessing earnings trend over time and against industry benchmarks is more valuable than looking at a single earnings announcement in one point in time. Investors may find my commentary, albeit very high-level and brief, on Haier Electronics Group Co., Ltd. (HKG:1169) useful as an attempt to give more color around how Haier Electronics Group is currently performing.

See our latest analysis for Haier Electronics Group

Did 1169 beat its long-term earnings growth trend and its industry?

1169's trailing twelve-month earnings (from 31 December 2018) of CN¥3.8b has jumped 14% compared to the previous year.

Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 12%, indicating the rate at which 1169 is growing has accelerated. What's enabled this growth? Let's see whether it is merely because of industry tailwinds, or if Haier Electronics Group has experienced some company-specific growth.

In terms of returns from investment, Haier Electronics Group has fallen short of achieving a 20% return on equity (ROE), recording 15% instead. However, its return on assets (ROA) of 7.0% exceeds the HK Consumer Durables industry of 4.4%, indicating Haier Electronics Group has used its assets more efficiently. Though, its return on capital (ROC), which also accounts for Haier Electronics Group’s debt level, has declined over the past 3 years from 15% to 13%.

What does this mean?

While past data is useful, it doesn’t tell the whole story. Companies that have performed well in the past, such as Haier Electronics Group gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. You should continue to research Haier Electronics Group to get a more holistic view of the stock by looking at:

1. Future Outlook: What are well-informed industry analysts predicting for 1169’s future growth? Take a look at our free research report of analyst consensus for 1169’s outlook.
2. Financial Health: Are 1169’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 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.