For long term investors, improvement in profitability and outperformance against the industry can be important characteristics in a stock. In this article, I will take a look at Apollo Global Management LLC’s (NYSE:APO) track record on a high level, to give you some insight into how the company has been performing against its historical trend and its industry peers. See our latest analysis for Apollo Global Management
Did APO’s recent earnings growth beat the long-term trend and the industry?
I prefer 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 allows me to assess different stocks on a similar basis, using the latest information. For Apollo Global Management, its most recent bottom-line (trailing twelve month) is US$594.92M, which, relative to the previous year’s figure, has climbed up by a non-trivial 53.32%. Since these values may be relatively short-term, I’ve calculated an annualized five-year figure for APO’s earnings, which stands at US$202.09M This means that, on average, Apollo Global Management has been able to steadily raise its net income over the last couple of years as well.What’s the driver of this growth? Let’s see if it is only due to industry tailwinds, or if Apollo Global Management has seen some company-specific growth. Over the last few years, Apollo Global Management increased bottom-line, while its top-line declined, by effectively managing its costs. This has led to to a margin expansion and profitability over time. Viewing growth from a sector-level, the US capital markets industry has been growing its average earnings by double-digit 15.86% over the past twelve months, and 11.37% over the past five. This means that any tailwind the industry is profiting from, Apollo Global Management is able to amplify this to its advantage.
What does this mean?
Apollo Global Management’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Companies that have performed well in the past, such as Apollo Global Management gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I recommend you continue to research Apollo Global Management to get a more holistic view of the stock by looking at:
- 1. Financial Health: Is APO’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 APO 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 APO 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.