Did AB Science SA.’s (EPA:AB) Recent Earnings Growth Beat The Trend?
Measuring AB Science SA.’s (ENXTPA:AB) track record of past performance is an insightful exercise for investors. It enables us to reflect on whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess AB’s recent performance announced on 30 June 2017 and compare these figures to its historical trend and industry movements. View our latest analysis for AB Science
Commentary On AB’s Past Performance
To account for any quarterly or half-yearly updates, I use data from the most recent 12 months, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This blend allows me to examine different companies on a similar basis, using new information. For AB Science, its most recent bottom-line (trailing twelve month) is -€26.45M, which, against the prior year’s figure, has become less negative. Given that these values are somewhat short-term thinking, I have estimated an annualized five-year figure for AB Science’s earnings, which stands at -€17.65M. This means AB Science has historically performed better than recently, although it seems like earnings are now heading back towards a more favorable position once more.
We can further evaluate AB Science’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the last five years AB Science’s top-line has grown by a mere 7.97%, on average. The company’s inability to breakeven has been aided by the relatively flat top-line in the past. Viewing growth from a sector-level, the FR pharmaceuticals industry has been relatively flat in terms of earnings growth over the past few years. This suggests that while AB Science is presently unprofitable, whatever recent headwind the industry is experiencing, AB Science is less exposed compared to 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 predict what will occur going forward, and when. The most useful step is to assess company-specific issues AB Science may be facing and whether management guidance has steadily been met in the past. I recommend you continue to research AB Science to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for AB’s future growth? Take a look at our free research report of analyst consensus for AB’s outlook.
2. Financial Health: Is AB’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 trailing twelve months from 30 June 2017. 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.
