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Examining Kentucky First Federal Bancorp’s (NASDAQ:KFFB) past track record of performance is a useful exercise for investors. It allows us to reflect on whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess KFFB’s latest performance announced on 30 June 2018 and weight these figures against its longer term trend and industry movements.
Were KFFB’s earnings stronger than its past performances and the industry?
KFFB’s trailing twelve-month earnings (from 30 June 2018) of US$1m has jumped 41% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of -18%, indicating the rate at which KFFB is growing has accelerated. What’s enabled this growth? Let’s see if it is only a result of industry tailwinds, or if Kentucky First Federal Bancorp has seen some company-specific growth.
In terms of returns from investment, Kentucky First Federal Bancorp has fallen short of achieving a 20% return on equity (ROE), recording 2.0% instead. Furthermore, its return on assets (ROA) of 0.4% is below the US Mortgage industry of 0.7%, indicating Kentucky First Federal Bancorp’s are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Kentucky First Federal Bancorp’s debt level, has declined over the past 3 years from 3.7% to 1.8%. This correlates with an increase in debt holding, with debt-to-equity ratio rising from 36% to 79% over the past 5 years.
What does this mean?
Though Kentucky First Federal Bancorp’s past data is helpful, it is only one aspect of my investment thesis. Recent positive growth doesn’t necessarily mean it’s onwards and upwards for the company. There could be factors that are influencing the entire industry hence the high industry growth rate over the same time period. I recommend you continue to research Kentucky First Federal Bancorp to get a better picture of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for KFFB’s future growth? Take a look at our free research report of analyst consensus for KFFB’s outlook.
Financial Health: Are KFFB’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 30 June 2018. This may not be consistent with full year annual report figures.
To help readers see past 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. For errors that warrant correction please contact the editor at firstname.lastname@example.org.