When Atossa Genetics Inc (NASDAQ:ATOS) announced its most recent earnings (31 March 2018), I did two things: looked at its past earnings track record, then look at what is happening in the industry. Understanding how Atossa Genetics performed requires a benchmark rather than trying to assess a standalone number at one point in time. Below is a quick commentary on how I see ATOS has performed. View our latest analysis for Atossa Genetics
Commentary On ATOS’s Past Performance
I prefer to use the ‘latest twelve-month’ data, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This technique enables me to analyze different companies on a more comparable basis, using the latest information. For Atossa Genetics, its most recent earnings (trailing twelve month) is -US$10.86M, which, against the prior year’s figure, has become more negative. Given that these figures may be fairly short-term thinking, I’ve determined an annualized five-year figure for ATOS’s net income, which stands at -US$8.64M. This doesn’t seem to paint a better picture, since earnings seem to have consistently been getting more and more negative over time.
We can further analyze Atossa Genetics’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the last five years Atossa Genetics has seen an annual decline in revenue of -40.04%, on average. This adverse movement is a driver of the company’s inability to reach breakeven. Has the entire industry experienced this headwind? Eyeballing growth from a sector-level, the US medical equipment industry has been growing, albeit, at a subdued single-digit rate of 8.02% over the prior year, and 8.70% over the past five years. This means whatever uplift the industry is deriving benefit from, Atossa Genetics has not been able to leverage it as much as its average peer.
What does this mean?
Atossa Genetics’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. With companies that are currently loss-making, it is always hard to envisage what will happen in the future and when. The most valuable step is to examine company-specific issues Atossa Genetics may be facing and whether management guidance has dependably been met in the past. You should continue to research Atossa Genetics to get a more holistic view of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for ATOS’s future growth? Take a look at our free research report of analyst consensus for ATOS’s outlook.
- Financial Health: Is ATOS’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 31 March 2018. 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.