For investors, increase in profitability and industry-beating performance can be essential considerations in an investment. Below, I will examine Brookdale Senior Living Inc’s (NYSE:BKD) track record on a high level, to give you some insight into how the company has been performing against its long term trend and its industry peers. View our latest analysis for Brookdale Senior Living
Despite a decline, did BKD underperform the long-term trend and the industry?
I like to use the ‘latest twelve-month’ data, 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 assess various companies on a similar basis, using the most relevant data points. For Brookdale Senior Living, its latest trailing-twelve-month earnings is -US$571.42M, which, against last year’s level, has become more negative. Given that these figures may be fairly short-term, I have determined an annualized five-year value for Brookdale Senior Living’s earnings, which stands at -US$225.00M. This doesn’t look much better, as earnings seem to have steadily been getting more and more negative over time.We can further evaluate Brookdale Senior Living’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past half a decade Brookdale Senior Living’s top-line has grown by 11.88% on average, signalling that the company is in a high-growth period with expenses racing ahead revenues, leading to annual losses. Looking at growth from a sector-level, the US healthcare industry has been growing, albeit, at a unexciting single-digit rate of 9.96% in the past year, and a substantial 10.39% over the past five. This suggests that whatever tailwind the industry is benefiting from, Brookdale Senior Living has not been able to reap as much as its industry peers.
What does this mean?
Though Brookdale Senior Living’s past data is helpful, it is only one aspect of my investment thesis. Companies that incur net loss is always hard to forecast what will occur going forward, and when. The most valuable step is to assess company-specific issues Brookdale Senior Living may be facing and whether management guidance has consistently been met in the past. I recommend you continue to research Brookdale Senior Living to get a better picture of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for BKD’s future growth? Take a look at our free research report of analyst consensus for BKD’s outlook.
- Financial Health: Is BKD’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.
- 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.