Investors with a long-term horizong may find it valuable to assess Moneysupermarket.com Group PLC's (LSE:MONY) earnings trend over time and against its industry benchmark as opposed to simply looking at a sincle earnings announcement at one point in time. Below is my commentary, albiet very simple and high-level, on how Moneysupermarket.com Group is currently performing.
Were MONY's earnings stronger than its past performances and the industry?
MONY's trailing twelve-month earnings (from 30 June 2019) of UK£94m has jumped 17% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 12%, indicating the rate at which MONY is growing has accelerated. How has it been able to do this? Let's see whether it is only due to industry tailwinds, or if Moneysupermarket.com Group has experienced some company-specific growth.
In terms of returns from investment, Moneysupermarket.com Group has invested its equity funds well leading to a 56% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 31% exceeds the GB Online Retail industry of 7.4%, indicating Moneysupermarket.com Group has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Moneysupermarket.com Group’s debt level, has increased over the past 3 years from 48% to 57%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 47% to 15% over the past 5 years.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Positive growth and profitability are what investors like to see in a company’s track record, but how do we properly assess sustainability? You should continue to research Moneysupermarket.com Group to get a better picture of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for MONY’s future growth? Take a look at our free research report of analyst consensus for MONY’s outlook.
- Financial Health: Are MONY’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 2019. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.