Where Public Joint Stock Company Long-Distance and International Telecommunications Rostelecom (MCX:RTKM) Stands In Terms Of Earnings Growth Against Its Industry

Assessing Public Joint Stock Company Long-Distance and International Telecommunications Rostelecom's (MISX:RTKM) past track record of performance is a valuable exercise for investors. It enables us to reflect on whether the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess RTKM's recent performance announced on 31 December 2017 and evaluate these figures to its longer term trend and industry movements. View our latest analysis for Long-Distance and International Telecommunications Rostelecom

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

I like to 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 analyze many different companies on a more comparable basis, using new information. For Long-Distance and International Telecommunications Rostelecom, its latest earnings (trailing twelve month) is RUРУБ13.70B, which, in comparison to the previous year's figure, has moved up by 16.56%. Given that these figures are fairly short-term thinking, I’ve calculated an annualized five-year value for Long-Distance and International Telecommunications Rostelecom's net income, which stands at RUРУБ22.75B This shows that, though earnings increased from last year's level, in the long run, Long-Distance and International Telecommunications Rostelecom's earnings have been diminishing on average.

Why is this? Well, let’s take a look at what’s occurring with margins and if the whole industry is feeling the heat. Although revenue growth in the past couple of years, has been negative, earnings growth has been deteriorating by even more, meaning Long-Distance and International Telecommunications Rostelecom has been increasing its expenses. This harms margins and earnings, and is not a sustainable practice. Viewing growth from a sector-level, the RU telecom industry has been relatively flat in terms of earnings growth . Thought this is a bit of a change from a volatile drop of -15.66% in the last few years. This shows that any recent headwind the industry is experiencing, Long-Distance and International Telecommunications Rostelecom is relatively better-cushioned than its peers.

What does this mean?

While past data is useful, it doesn’t tell the whole story. Recent positive growth doesn’t necessarily mean it’s onwards and upwards for the company. You should continue to research Long-Distance and International Telecommunications Rostelecom to get a more holistic view of the stock by looking at:

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