How Does Lumber Liquidators Holdings Inc's (LL) EPS Growth Stack Up Against Industry Performance?

For investors, increase in profitability and industry-beating performance can be essential considerations in an investment. Below, I will examine Lumber Liquidators Holdings Inc's (NYSE:LL) 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. Check out our latest analysis for Lumber Liquidators Holdings

Could LL beat the long-term trend and outperform its industry?

I look at 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 technique allows me to analyze different companies in a uniform manner using the most relevant data points. Lumber Liquidators Holdings's most recent bottom-line -$46.3M, which, relative to the previous year's level, has become less negative. Since these figures may be somewhat nearsighted, I’ve estimated an annualized five-year figure for Lumber Liquidators Holdings's net income, which stands at $11.7M.

We can further analyze Lumber Liquidators Holdings's loss by researching what’s going on in the industry as well as within the company. Initially, I want to briefly look into the line items. Revenue growth over last couple of years has grown by a mere 6.68%. Since top-line growth is also pretty flat, the key to profitability in the future would be managing cost growth rates. Scanning growth from a sector-level, the US specialty retail industry has been growing, albeit, at a muted single-digit rate of 8.14% in the previous twelve months, and 5.98% over the previous five years. This means that, although Lumber Liquidators Holdings is presently running a loss, it may have benefited from industry tailwinds, moving earnings into a more favorable position.

What does this mean?

Though Lumber Liquidators Holdings's past data is helpful, it is only one aspect of my investment thesis. Companies that incur net loss is always difficult to predict what will happen in the future and when. The most valuable step is to assess company-specific issues Lumber Liquidators Holdings may be facing and whether management guidance has steadily been met in the past. You should continue to research Lumber Liquidators Holdings to get a better picture of the stock by looking at:

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

2. Financial Health: Is LL’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.

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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.