Bristow Group Inc’s (NYSE:BRS) Earnings Dropped -97%, Did Its Industry Show Weakness Too?
After reading Bristow Group Inc’s (NYSE:BRS) most recent earnings announcement (30 September 2017), I found it useful to look back at how the company has performed in the past and compare this against the latest numbers. As a long-term investor I tend to focus on earnings trend, rather than a single number at one point in time. Also, comparing it against an industry benchmark to understand whether it outperformed, or is simply riding an industry wave, is a crucial aspect. Below is a brief commentary on my key takeaways. View our latest analysis for Bristow Group
Was BRS’s recent earnings decline indicative of a tough track record?
I prefer to use data from the most recent 12 months, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This method allows me to examine different companies on a more comparable basis, using new information. For Bristow Group, its most recent earnings is -$186.5M, which, against the prior year’s level, has become more negative. Given that these values are relatively short-term, I have calculated an annualized five-year figure for BRS’s earnings, which stands at $46.2M.
Additionally, we can examine Bristow Group’s loss by looking at what has been happening in the industry as well as within the company. Firstly, I want to briefly look into the line items. Revenue growth over the past few years has increased by a mere 4.48%. Since top-line growth is also pretty stale the key to profitability moving forward would be managing cost growth rates. Eyeballing growth from a sector-level, the US energy services industry has been relatively flat in terms of earnings growth . Thought this is a bit of a change from a volatile drop of -12.37% in the last couple of years. This shows that whatever near-term the industry is facing, it’s hitting Bristow Group harder than its 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 happen in the future and when. The most useful step is to assess company-specific issues Bristow Group may be facing and whether management guidance has dependably been met in the past. You should continue to research Bristow Group to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for BRS’s future growth? Take a look at our free research report of analyst consensus for BRS’s outlook.
2. Financial Health: Is BRS’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.
3. 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 last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. 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.