Examining Portland General Electric Company’s (NYSE:POR) past track record of performance is a useful exercise for investors. It allows us to reflect on whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess POR’s latest performance announced on 31 December 2018 and weight these figures against its longer term trend and industry movements.
Did POR beat its long-term earnings growth trend and its industry?
POR’s trailing twelve-month earnings (from 31 December 2018) of US$212m has jumped 13% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 7.6%, indicating the rate at which POR is growing has accelerated. How has it been able to do this? Let’s take a look at if it is only attributable to an industry uplift, or if Portland General Electric has experienced some company-specific growth.
In terms of returns from investment, Portland General Electric has fallen short of achieving a 20% return on equity (ROE), recording 8.5% instead. Furthermore, its return on assets (ROA) of 4.2% is below the US Electric Utilities industry of 4.2%, indicating Portland General Electric’s are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Portland General Electric’s debt level, has declined over the past 3 years from 4.7% to 4.4%.
What does this mean?
Though Portland General Electric’s past data is helpful, it is only one aspect of my investment thesis. While Portland General Electric has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. You should continue to research Portland General Electric to get a better picture of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for POR’s future growth? Take a look at our free research report of analyst consensus for POR’s outlook.
- Financial Health: Are POR’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 2018. This may not be consistent with full year annual report figures.
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