Today I will examine MidWestOne Financial Group Inc’s (NASDAQ:MOFG) latest earnings update (30 September 2017) and compare these figures against its performance over the past couple of years, in addition to how the rest of MOFG’s industry performed. As a long-term investor, I find it useful to analyze the company’s trend over time in order to estimate whether or not the company is able to meet its goals, and eventually grow sustainably over time. View our latest analysis for MidWestOne Financial Group
How Did MOFG’s Recent Performance Stack Up Against Its Past?
I look at data from the most recent 12 months, which annualizes the most recent half-year data, or in some cases, the latest annual report is already the most recent financial year data. This blend allows me to analyze various companies on a similar basis, using new information. “For MidWestOne Financial Group, its “, most recent bottom-line is $24.2M, which, against last year’s figure, has fallen by -2.42%. Since these values may be somewhat nearsighted, I have determined an annualized five-year value for MidWestOne Financial Group’s net income, which stands at $18.3M. This shows that despite the fact that earnings declined from the previous year, over the long run, MidWestOne Financial Group’s earnings have been rising on average.
How has it been able to do this? Let’s see whether it is merely due to industry tailwinds, or if MidWestOne Financial Group has seen some company-specific growth. The hike in earnings seems to be driven by a robust top-line increase overtaking its growth rate of expenses. Though this resulted in a margin contraction, it has made MidWestOne Financial Group more profitable. Looking at growth from a sector-level, the US banks industry has been growing, albeit, at a muted single-digit rate of 9.80% over the past year, and 8.97% over the past five. This means that any tailwind the industry is enjoying, MidWestOne Financial Group has not been able to reap as much as its average peer.
What does this mean?
MidWestOne Financial Group’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Companies are profitable, but have volatile earnings, can have many factors affecting its business. I recommend you continue to research MidWestOne Financial Group to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for MOFG’s future growth? Take a look at our free research report of analyst consensus for MOFG’s outlook.
2. Financial Health: Is MOFG’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.