Does NORDTELEKOM Telecommunications Service Provider Public Limited Company's (BUSE:NORDTELEKOM) Past Performance Indicate A Stronger Future?

Today I will take a look at NORDTELEKOM Telecommunications Service Provider Public Limited Company's (BUSE:NORDTELEKOM) most recent earnings update (30 June 2017) and compare these latest figures against its performance over the past few years, as well as how the rest of the telecom industry performed. As an investor, I find it beneficial to assess NORDTELEKOM’s trend over the short-to-medium term in order to gauge whether or not the company is able to meet its goals, and ultimately sustainably grow over time. Check out our latest analysis for NORDTELEKOM Telecommunications Service Provider

How NORDTELEKOM fared against its long-term earnings performance and its industry

To account for any quarterly or half-yearly updates, I use data from the most recent 12 months, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This blend enables me to assess many different companies in a uniform manner using the latest information. For NORDTELEKOM Telecommunications Service Provider, its most recent trailing-twelve-month earnings is -FT138.31M, which, in comparison to the previous year's level, has become less negative. Given that these figures are somewhat myopic, I have determined an annualized five-year value for NORDTELEKOM Telecommunications Service Provider's net income, which stands at -FT123.84M. This shows that, NORDTELEKOM Telecommunications Service Provider has historically performed better than recently, although it seems like earnings are now heading back towards to right direction again.

We can further assess NORDTELEKOM Telecommunications Service Provider's loss by looking at what the industry has been experiencing over the past few years. Each year, for the past five years NORDTELEKOM Telecommunications Service Provider has seen an annual decline in revenue of -32.71%, on average. This adverse movement is a driver of the company's inability to reach breakeven. Has the entire industry experienced this headwind? Scanning growth from a sector-level, the HU telecom industry has been growing, albeit, at a unexciting single-digit rate of 6.54% in the past twelve months, and 4.04% over the previous five years. This means despite the fact that NORDTELEKOM Telecommunications Service Provider is currently running a loss, it may have benefited from industry tailwinds, moving earnings in the right direction.

What does this mean?

While past data is useful, it doesn’t tell the whole story. Companies that incur net loss is always hard to predict what will happen in the future and when. The most useful step is to assess company-specific issues NORDTELEKOM Telecommunications Service Provider may be facing and whether management guidance has steadily been met in the past. I suggest you continue to research NORDTELEKOM Telecommunications Service Provider to get a more holistic view of the stock by looking at:

• 1. Financial Health: Is NORDTELEKOM’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 NORDTELEKOM 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 NORDTELEKOM 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.

NB: Figures in this article are calculated using data from the trailing twelve months from 30 June 2017. This may not be consistent with full year annual report figures.

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Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.