Assessing Aemetis Inc’s (NASDAQ:AMTX) performance as a company requires looking at more than just a years’ earnings data. Below, I will run you through a simple sense check to build perspective on how Aemetis is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its oil and gas industry peers. Check out our latest analysis for Aemetis
Despite a decline, did AMTX underperform the long-term trend and the industry?
For the purpose of this commentary, I like to use data from the most recent 12 months, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This method enables me to assess different stocks in a uniform manner using the most relevant data points. For Aemetis, its most recent bottom-line (trailing twelve month) is -US$32.14M, which compared to the previous year’s figure, has become more negative. Given that these values are relatively nearsighted, I have estimated an annualized five-year figure for AMTX’s earnings, which stands at -US$15.74M. This doesn’t seem to paint a better picture, since earnings seem to have consistently been getting more and more negative over time.
We can further analyze Aemetis’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past five years Aemetis’s revenue growth has been fairly unexciting, with an annual growth rate of 0.18%, on average. The company’s inability to breakeven has been aided by the relatively flat top-line in the past. Eyeballing growth from a sector-level, the US oil and gas industry has been growing its average earnings by double-digit 24.40% over the prior twelve months, . This is a turnaround from a volatile drop of -5.62% in the last couple of years. This means that whatever tailwind the industry is deriving benefit from, Aemetis 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 predict what will occur going forward, and when. The most useful step is to assess company-specific issues Aemetis may be facing and whether management guidance has dependably been met in the past. I suggest you continue to research Aemetis to get a more holistic view of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for AMTX’s future growth? Take a look at our free research report of analyst consensus for AMTX’s outlook.
Financial Health: Is AMTX’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.