How Does Citrix Systems, Inc.'s (NASDAQ:CTXS) Earnings Growth Stack Up Against Industry Performance?
Understanding how Citrix Systems, Inc. (NasdaqGS:CTXS) is performing as a company requires looking at more than just a years' earnings. Today I will run you through a basic sense check to gain perspective on how Citrix Systems is doing by comparing its latest earnings with its long-term trend as well as the performance of its software industry peers.
View our latest analysis for Citrix Systems
Did CTXS beat its long-term earnings growth trend and its industry?
CTXS's trailing twelve-month earnings (from 31 December 2019) of US$682m has jumped 18% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 14%, indicating the rate at which CTXS is growing has accelerated. How has it been able to do this? Let's take a look at if it is merely owing to an industry uplift, or if Citrix Systems has experienced some company-specific growth.
In terms of returns from investment, Citrix Systems has invested its equity funds well leading to a 81% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 16% exceeds the US Software industry of 5.8%, indicating Citrix Systems has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Citrix Systems’s debt level, has increased over the past 3 years from 19% to 22%.
What does this mean?
Citrix Systems's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. Positive growth and profitability are what investors like to see in a company’s track record, but how do we properly assess sustainability? You should continue to research Citrix Systems to get a better picture of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for CTXS’s future growth? Take a look at our free research report of analyst consensus for CTXS’s outlook.
- Financial Health: Are CTXS’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.
NB: Figures in this article are calculated using data from the trailing twelve months from 31 December 2019. This may not be consistent with full year annual report figures.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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