In this article, I will take a look at HTG Molecular Diagnostics Inc’s (NASDAQ:HTGM) most recent earnings update (30 September 2017) and compare these latest figures against its performance over the past few years, along with how the rest of HTGM’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. See our latest analysis for HTGM
Did HTGM’s recent EPS Growth beat the long-term trend and the industry?
I look at the ‘latest twelve-month’ data, 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 technique allows me to assess many different companies on a similar basis, using the most relevant data points. For HTG Molecular Diagnostics, the latest twelve-month earnings -$22.7M, which, relative to the prior year’s figure, has become less negative. Since these figures are relatively nearsighted, I’ve determined an annualized five-year figure for HTG Molecular Diagnostics’s earnings, which stands at -$20.5M. This means HTG Molecular Diagnostics has historically performed better than recently, though it seems like earnings are now heading back towards a more favorable position once more.
We can further analyze HTG Molecular Diagnostics’s loss by looking at what has been happening in the industry on top of within the company. Initially, I want to quickly look into the line items. Revenue growth over last few years has rose by 25.70%, indicating that HTG Molecular Diagnostics is in a high-growth phase with expenses racing ahead elevated top-line growth rates. Looking at growth from a sector-level, the US health care technology industry has been growing its average earnings by double-digit 15.49% over the prior twelve months, and 14.73% over the previous five years. This means that whatever tailwind the industry is enjoying, HTG Molecular Diagnostics has not been able to leverage it as much as its average peer.
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 hard to envisage what will happen in the future and when. The most insightful step is to assess company-specific issues HTG Molecular Diagnostics may be facing and whether management guidance has dependably been met in the past. You should continue to research HTG Molecular Diagnostics to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for HTGM’s future growth? Take a look at our free research report of analyst consensus for HTGM’s outlook.
2. Financial Health: Is HTGM’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.