Did Hunt Mining Corp’s (CVE:HMX) Earnings Growth Outperform The Industry?
Assessing Hunt Mining Corp’s (TSXV:HMX) 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 HMX’s recent performance announced on 30 September 2017 and evaluate these figures to its long-term trend and industry movements. View our latest analysis for Hunt Mining
How Well Did HMX Perform?
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 enables me to assess various companies on a more comparable basis, using the most relevant data points. For Hunt Mining, its most recent earnings (trailing twelve month) is -US$129.98K, which, in comparison to the previous year’s figure, has become less negative. Since these figures are fairly short-term thinking, I’ve estimated an annualized five-year figure for HMX’s net income, which stands at -US$3.71M. This means that, though net income is negative, it has become less negative over the years.
We can further evaluate Hunt Mining’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the last five years Hunt Mining has seen an annual decline in revenue of -41.21%, on average. This adverse movement is a driver of the company’s inability to reach breakeven. Has the entire industry experienced this headwind? Viewing growth from a sector-level, the Canadian metals and mining industry has been growing its average earnings by double-digit 42.48% over the previous twelve months, and 16.30% over the past five. This means though Hunt Mining is presently running a loss, it may have benefited from industry tailwinds, moving earnings in the right direction.
What does this mean?
Though Hunt Mining’s past data is helpful, it is only one aspect of my investment thesis. With companies that are currently loss-making, it is always difficult to forecast what will occur going forward, and when. The most valuable step is to examine company-specific issues Hunt Mining may be facing and whether management guidance has dependably been met in the past. I recommend you continue to research Hunt Mining to get a better picture of the stock by looking at:
1. Financial Health: Is HMX’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.
2. 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 September 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.
