Fusion Telecommunications International Inc (FSNN): Does -14% EPS Decline Lately Make It An Underperformer?

Measuring Fusion Telecommunications International Inc’s (NASDAQ:FSNN) track record of past performance is a valuable exercise for investors. It allows us to understand whether or not the company has met or exceed expectations, which is an insightful signal for future performance. Today I will assess FSNN’s recent performance announced on 30 September 2017 and compare these figures to its historical trend and industry movements. Check out our latest analysis for Fusion Telecommunications International

Commentary On FSNN’s Past Performance

I use the ‘latest twelve-month’ data, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This blend enables me to analyze many different companies on a more comparable basis, using the most relevant data points. For Fusion Telecommunications International, the latest twelve-month earnings -$16.4M, which, in comparison to the previous year’s figure, has become more negative. Since these values may be somewhat short-term, I’ve estimated an annualized five-year value for FSNN’s net income, which stands at -$8.5M. This doesn’t look much better, since earnings seem to have steadily been getting more and more negative over time.

NasdaqCM:FSNN Income Statement Dec 9th 17
NasdaqCM:FSNN Income Statement Dec 9th 17
Additionally, we can evaluate Fusion Telecommunications International’s loss by looking at what has been happening in the industry on top of within the company. First, I want to quickly look into the line items. Revenue growth over last few years has increased by 20.22%, signalling that Fusion Telecommunications International is in a high-growth phase with expenses racing ahead elevated top-line growth rates. Eyeballing growth from a sector-level, the US telcos industry has been growing, albeit, at a unexciting single-digit rate of 5.74% over the prior year, and 4.08% over the past five years. This means whatever uplift the industry is enjoying, Fusion Telecommunications International has not been able to realize the gains unlike its industry peers.

What does this mean?

While past data is useful, it doesn’t tell the whole story. With companies that are currently loss-making, it is always difficult to forecast what will happen in the future and when. The most insightful step is to examine company-specific issues Fusion Telecommunications International may be facing and whether management guidance has steadily been met in the past. You should continue to research Fusion Telecommunications International to get a better picture of the stock by looking at:

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

2. Financial Health: Is FSNN’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.