Does Time Watch Investments Limited's (HKG:2033) Past Performance Indicate A Stronger Future?

For investors with a long-term horizon, examining earnings trend over time and against industry peers is more insightful than looking at an earnings announcement in one point in time. Investors may find my commentary, albeit very high-level and brief, on Time Watch Investments Limited (SEHK:2033) useful as an attempt to give more color around how Time Watch Investments is currently performing.

See our latest analysis for Time Watch Investments

Were 2033's earnings stronger than its past performances and the industry?

2033's trailing twelve-month earnings (from 30 June 2019) of HK$305m has increased by 4.8% compared to the previous year.

Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of -3.9%, indicating the rate at which 2033 is growing has accelerated. How has it been able to do this? Well, let’s take a look at whether it is solely because of industry tailwinds, or if Time Watch Investments has experienced some company-specific growth.

In terms of returns from investment, Time Watch Investments has fallen short of achieving a 20% return on equity (ROE), recording 14% instead. However, its return on assets (ROA) of 10.0% exceeds the HK Luxury industry of 5.3%, indicating Time Watch Investments has used its assets more efficiently. Though, its return on capital (ROC), which also accounts for Time Watch Investments’s debt level, has declined over the past 3 years from 18% to 14%. This correlates with an increase in debt holding, with debt-to-equity ratio rising from 2.4% to 9.5% over the past 5 years.

What does this mean?

Though Time Watch Investments's past data is helpful, it is only one aspect of my investment thesis. Companies that have performed well in the past, such as Time Watch Investments gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I suggest you continue to research Time Watch Investments to get a better picture of the stock by looking at:

1. Future Outlook: What are well-informed industry analysts predicting for 2033’s future growth? Take a look at our free research report of analyst consensus for 2033’s outlook.
2. Financial Health: Are 2033’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.