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For investors with a long-term horizon, examining earnings trend over time and against industry peers is more insightful than looking at an earnings announcement in one point in time. Investors may find my commentary, albeit very high-level and brief, on Blucora, Inc. (NASDAQ:BCOR) useful as an attempt to give more color around how Blucora is currently performing.
Were BCOR's earnings stronger than its past performances and the industry?
BCOR's trailing twelve-month earnings (from 31 March 2019) of US$61m has jumped 47% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 44%, indicating the rate at which BCOR is growing has accelerated. How has it been able to do this? Well, let’s take a look at if it is solely due to an industry uplift, or if Blucora has experienced some company-specific growth.
In terms of returns from investment, Blucora has fallen short of achieving a 20% return on equity (ROE), recording 10% instead. However, its return on assets (ROA) of 7.2% exceeds the US Capital Markets industry of 1.1%, indicating Blucora has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Blucora’s debt level, has increased over the past 3 years from 1.3% to 8.6%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 46% to 40% over the past 5 years.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Companies that have performed well in the past, such as Blucora gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I recommend you continue to research Blucora to get a better picture of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for BCOR’s future growth? Take a look at our free research report of analyst consensus for BCOR’s outlook.
- Financial Health: Are BCOR’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 2019. 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 firstname.lastname@example.org. 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.