With A -26.58% Earnings Drop, Did CorMedix Inc (NYSEMKT:CRMD) Really Underperform?
When CorMedix Inc’s (AMEX:CRMD) announced its latest earnings (31 March 2018), I wanted to understand how these figures stacked up against its past performance. The two benchmarks I used were CorMedix’s average earnings over the past couple of years, and its industry performance. These are useful yardsticks to help me gauge whether or not CRMD actually performed well. Below is a quick commentary on how I see CRMD has performed. View our latest analysis for CorMedix
How Well Did CRMD Perform?
For the most up-to-date info, 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 allows me to examine different companies in a uniform manner using the most relevant data points. For CorMedix, its most recent earnings (trailing twelve month) is -US$35.60M, which compared to the previous year’s level, has become more negative. Since these figures may be relatively myopic, I have determined an annualized five-year figure for CorMedix’s net income, which stands at -US$15.95M. This doesn’t seem to paint a better picture, as earnings seem to have consistently been getting more and more negative over time.
We can further evaluate CorMedix’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the last five years CorMedix’s top-line has risen by 32.42% on average, indicating that the company is in a high-growth phase with expenses shooting ahead of revenues, leading to annual losses. Scanning growth from a sector-level, the US pharmaceuticals industry has been growing its average earnings by double-digit 11.92% over the past twelve months, and a more muted 9.59% over the last five years. This means that any tailwind the industry is benefiting from, CorMedix has not been able to gain as much as 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 envisage what will occur going forward, and when. The most valuable step is to assess company-specific issues CorMedix may be facing and whether management guidance has dependably been met in the past. I suggest you continue to research CorMedix to get a better picture of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for CRMD’s future growth? Take a look at our free research report of analyst consensus for CRMD’s outlook.
Financial Health: Is CRMD’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 March 2018. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
