For investors with a long-term horizon, assessing earnings trend over time and against industry benchmarks is more valuable than looking at a single earnings announcement in one point in time. Investors may find my commentary, albeit very high-level and brief, on Calyxt Inc (NASDAQ:CLXT) useful as an attempt to give more color around how Calyxt is currently performing. See our latest analysis for CLXT
How Well Did CLXT Perform?
I use the ‘latest twelve-month’ data, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This blend allows me to analyze many different companies in a uniform manner using the latest information. For Calyxt, the latest twelve-month earnings -$23.7M, which, relative to last year’s level, has become more negative. Given that these figures are fairly short-term, I’ve estimated an annualized five-year value for CLXT’s earnings, which stands at -$13.5M. This doesn’t seem to paint a better picture, as earnings seem to have steadily been getting more and more negative over time.Additionally, we can analyze Calyxt’s loss by looking at what’s going on in the industry as well as within the company. Firstly, I want to briefly look into the line items. Revenue growth over past few years has been negative at -90.77%. The key to profitability here is to make sure the company’s cost growth is well-controlled. Viewing growth from a sector-level, the US biotechnology industry has been growing its average earnings by double-digit 12.32% over the prior twelve months, and 20.04% over the past five years. This means that whatever uplift the industry is profiting from, Calyxt has not been able to realize the gains unlike its average peer.
What does this mean?
Though Calyxt’s past data is helpful, it is only one aspect of my investment thesis. Companies that incur net loss is always difficult to envisage what will occur going forward, and when. The most useful step is to examine company-specific issues Calyxt may be facing and whether management guidance has regularly been met in the past. I suggest you continue to research Calyxt to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for CLXT’s future growth? Take a look at our free research report of analyst consensus for CLXT’s outlook.
2. Financial Health: Is CLXT’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.