When C-MER Eye Care Holdings Limited (SEHK:3309) announced its most recent earnings (30 June 2017), 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 C-MER Eye Care Holdings 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 3309 has performed. See our latest analysis for C-MER Eye Care Holdings
Did 3309’s recent earnings growth beat the long-term trend and the industry?
For the most up-to-date info, I use the ‘latest twelve-month’ data, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This blend enables me to examine different stocks on a more comparable basis, using the latest information. For C-MER Eye Care Holdings, its most recent earnings (trailing twelve month) is HK$51.67M, which, relative to the prior year’s level, has risen by 21.29%. Given that these values may be relatively short-term, I’ve determined an annualized five-year figure for C-MER Eye Care Holdings’s net income, which stands at HK$42.76M This means that, on average, C-MER Eye Care Holdings has been able to consistently improve its net income over the past couple of years as well.What’s enabled this growth? Let’s see if it is solely because of industry tailwinds, or if C-MER Eye Care Holdings has seen some company-specific growth. In the last few years, C-MER Eye Care Holdings grew its bottom line faster than revenue by efficiently controlling its costs. This has caused a margin expansion and profitability over time. Viewing growth from a sector-level, the HK healthcare industry has been growing its average earnings by double-digit 19.67% over the prior twelve months, and a less exciting 7.16% over the past five. This means that whatever uplift the industry is deriving benefit from, C-MER Eye Care Holdings is capable of leveraging this to its advantage.
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 C-MER Eye Care Holdings gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. You should continue to research C-MER Eye Care Holdings to get a more holistic view of the stock by looking at:
- 1. Financial Health: Is 3309’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.
- 2. Valuation: What is 3309 worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether 3309 is currently mispriced by the market.
- 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.