Aptitude Software Group plc (LON:APTD): Has Recent Earnings Growth Beaten Long-Term Trend?
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When Aptitude Software Group plc's (LON:APTD) announced its latest earnings (31 December 2018), I wanted to understand how these figures stacked up against its past performance. The two benchmarks I used were Aptitude Software Group's average earnings over the past couple of years, and its industry performance. These are useful yardsticks to help me gauge whether or not APTD actually performed well. Below is a quick commentary on how I see APTD has performed.
View our latest analysis for Aptitude Software Group
How APTD fared against its long-term earnings performance and its industry
APTD's trailing twelve-month earnings (from 31 December 2018) of UK£14m has jumped 31% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 23%, indicating the rate at which APTD is growing has accelerated. What's enabled this growth? Let's take a look at whether it is only attributable to industry tailwinds, or if Aptitude Software Group has experienced some company-specific growth.
In terms of returns from investment, Aptitude Software Group has invested its equity funds well leading to a 21% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 12% exceeds the GB Software industry of 5.7%, indicating Aptitude Software Group has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Aptitude Software Group’s debt level, has increased over the past 3 years from 14% to 18%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 35% to 18% over the past 5 years.
What does this mean?
Aptitude Software Group's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. While Aptitude Software Group 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 Aptitude Software Group to get a better picture of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for APTD’s future growth? Take a look at our free research report of analyst consensus for APTD’s outlook.
Financial Health: Are APTD’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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
