Does Chart Industries Inc’s (NASDAQ:GTLS) Past Performance Indicate A Stronger Future?
After reading Chart Industries Inc’s (NASDAQ:GTLS) most recent earnings announcement (30 September 2017), I found it useful to look back at how the company has performed in the past and compare this against the latest numbers. As a long term investor, I pay close attention to earnings trend, rather than the figures published at one point in time. I also compare against an industry benchmark to check whether Chart Industries’s performance has been impacted by industry movements. In this article I briefly touch on my key findings. See our latest analysis for Chart Industries
Commentary On GTLS’s Past Performance
I prefer to use data from the most recent 12 months, 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 different companies on a more comparable basis, using the latest information. For Chart Industries, its most recent trailing-twelve-month earnings is -US$1.91M, which, in comparison to the prior year’s figure, has become less negative. Given that these values may be fairly short-term, I have created an annualized five-year value for GTLS’s earnings, which stands at US$17.26M.
We can further evaluate Chart Industries’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past five years Chart Industries’s top-line has increased by a mere 2.56%, on average. The company’s inability to breakeven has been aided by the relatively flat top-line in the past. Looking at growth from a sector-level, the US machinery industry has been growing its average earnings by double-digit 18.32% in the previous twelve months, and a less exciting 3.72% over the previous five years. This suggests that, while Chart Industries is currently running a loss, it may have benefited from industry tailwinds, moving earnings in the right direction.
What does this mean?
Though Chart Industries’s past data is helpful, it is only one aspect of my investment thesis. Companies that incur net loss is always hard to envisage what will happen in the future and when. The most useful step is to assess company-specific issues Chart Industries may be facing and whether management guidance has regularly been met in the past. You should continue to research Chart Industries to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for GTLS’s future growth? Take a look at our free research report of analyst consensus for GTLS’s outlook.
2. Financial Health: Is GTLS’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 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.