Does Air Partner plc’s (LON:AIR) Past Performance Indicate A Stronger Future?
Analyzing Air Partner plc’s (LSE:AIR) track record of past performance is a valuable exercise for investors. It enables us to reflect on whether or not the company has met expectations, which is a powerful signal for future performance. Today I will assess AIR’s recent performance announced on 31 July 2017 and compare these figures to its long-term trend and industry movements. View our latest analysis for Air Partner
Were AIR’s earnings stronger than its past performances and the industry?
For the purpose of this commentary, I like to use the ‘latest twelve-month’ data, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This enables me to analyze various companies in a uniform manner using the most relevant data points. Air Partner’s latest twelve-month earnings is £3.5M, which, against last year’s level, has increased by 48.78%. Since these values may be relatively short-term, I’ve computed an annualized five-year figure for Air Partner’s earnings, which stands at £2.6M. This suggests that, on average, Air Partner has been able to gradually grow its earnings over the past couple of years as well.
What’s the driver of this growth? Well, let’s take a look at if it is solely because of industry tailwinds, or if Air Partner has seen some company-specific growth. In the past couple of years, even though bottom-line growth has seen a decline, top-line growth has fallen at a faster rate, bringing about a margin expansion and Air Partner still maintaining profitability. Eyeballing growth from a sector-level, the UK airlines industry has been growing, albeit, at a unexciting single-digit rate of 4.55% in the past twelve months, and a substantial 12.08% over the previous few years. This means any near-term headwind the industry is enduring, Air Partner is relatively better-cushioned than its peers.
What does this mean?
While past data is useful, it doesn’t tell the whole story. While Air Partner has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. I suggest you continue to research Air Partner to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for AIR’s future growth? Take a look at our free research report of analyst consensus for AIR’s outlook.
2. Financial Health: Is AIR’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.
