Assessing Broadway Financial Corporation’s (NASDAQ:BYFC) past track record of performance is an insightful exercise for investors. It allows us to reflect on whether or not the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess BYFC’s recent performance announced on 31 March 2018 and evaluate these figures to its long-term trend and industry movements. See our latest analysis for Broadway Financial
How Well Did BYFC Perform?
I like to use the ‘latest twelve-month’ data, 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 allows me to analyze different stocks on a more comparable basis, using the latest information. For Broadway Financial, its latest trailing-twelve-month earnings is US$548.00K, which, against last year’s figure, has taken a dive by a significant -86.55%. Given that these values may be somewhat short-term, I have determined an annualized five-year value for BYFC’s earnings, which stands at -US$25.21K This means although earnings declined from last year, over a longer period of time, Broadway Financial’s earnings have been increasing on average.
How has it been able to do this? Let’s take a look at whether it is solely due to industry tailwinds, or if Broadway Financial has seen some company-specific growth. In the past couple of years, Broadway Financial increased its bottom line faster than revenue by efficiently controlling its costs. This has caused a margin expansion and profitability over time. Eyeballing growth from a sector-level, the US mortgage industry has been growing, albeit, at a subdued single-digit rate of 8.64% in the prior twelve months, and a substantial 14.71% over the past five. This suggests that whatever tailwind the industry is enjoying, Broadway Financial has not been able to realize the gains unlike its industry peers.
What does this mean?
Though Broadway Financial’s past data is helpful, it is only one aspect of my investment thesis. Companies that are profitable, but have unpredictable earnings, can have many factors impacting its business. I suggest you continue to research Broadway Financial to get a better picture of the stock by looking at:
- Financial Health: Is BYFC’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.