Assessing China Tian Lun Gas Holdings Limited’s (SEHK:1600) performance as a company requires looking at more than just a years’ earnings data. Below, I will run you through a simple sense check to build perspective on how China Tian Lun Gas Holdings is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its gas utilities industry peers. See our latest analysis for China Tian Lun Gas Holdings
Did 1600’s recent earnings growth beat the long-term trend and the industry?
To account for any quarterly or half-yearly updates, I use data from the most recent 12 months, which annualizes the most recent half-year data, or in some cases, the latest annual report is already the most recent financial year data. This enables me to analyze different stocks in a uniform manner using new information. “For China Tian Lun Gas Holdings, its “, latest earnings is CN¥349.1M, which, relative to the prior year’s figure, has jumped up by 16.99%. Given that these figures are somewhat nearsighted, I have calculated an annualized five-year value for 1600’s earnings, which stands at CN¥197.7M. This means on average, China Tian Lun Gas Holdings has been able to gradually raise its profits over the past few years as well.What’s enabled this growth? Well, let’s take a look at whether it is only owing to industry tailwinds, or if China Tian Lun Gas Holdings has seen some company-specific growth. The hike in earnings seems to be propelled by a substantial top-line increase beating its growth rate of costs. Though this has led to a margin contraction, it has made China Tian Lun Gas Holdings more profitable. Looking at growth from a sector-level, the HK gas utilities industry has been growing, albeit, at a muted single-digit rate of 3.87% in the prior twelve months, and 7.82% over the past five. This suggests that any recent headwind the industry is experiencing, the impact on China Tian Lun Gas Holdings has been softer relative to its peers.
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? You should continue to research China Tian Lun Gas Holdings to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for 1600’s future growth? Take a look at our free research report of analyst consensus for 1600’s outlook.
2. Financial Health: Is 1600’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 last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.