Examining how Minerals Technologies Inc. (NYSE:MTX) is performing as a company requires looking at more than just a years’ earnings. Below, I will run you through a simple sense check to build perspective on how Minerals Technologies is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its chemicals industry peers.
How Well Did MTX Perform?
MTX’s trailing twelve-month earnings (from 30 September 2018) of US$202m has jumped 29% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 20%, indicating the rate at which MTX is growing has accelerated. How has it been able to do this? Let’s see whether it is merely a result of an industry uplift, or if Minerals Technologies has experienced some company-specific growth.
In terms of returns from investment, Minerals Technologies has fallen short of achieving a 20% return on equity (ROE), recording 15% instead. However, its return on assets (ROA) of 7.9% exceeds the US Chemicals industry of 7.9%, indicating Minerals Technologies has used its assets more efficiently. Though, its return on capital (ROC), which also accounts for Minerals Technologies’s debt level, has declined over the past 3 years from 9.8% to 9.4%. This correlates with an increase in debt holding, with debt-to-equity ratio rising from 11% to 79% over the past 5 years.
What does this mean?
While past data is useful, it doesn’t tell the whole story. While Minerals Technologies has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. I suggest you continue to research Minerals Technologies to get a more holistic view of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for MTX’s future growth? Take a look at our free research report of analyst consensus for MTX’s outlook.
- Financial Health: Are MTX’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 30 September 2018. This may not be consistent with full year annual report figures.
To help readers see past 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. For errors that warrant correction please contact the editor at firstname.lastname@example.org.