Assessing China Cord Blood Corporation’s (NYSE:CO) past track record of performance is an insightful exercise for investors. It allows us to reflect on whether or not the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess CO’s recent performance announced on 30 September 2017 and evaluate these figures to its long-term trend and industry movements. View our latest analysis for China Cord Blood
Commentary On CO’s Past Performance
I use the ‘latest twelve-month’ data, 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 technique enables me to examine different companies on a similar basis, using new information. For China Cord Blood, its latest trailing-twelve-month earnings is CN¥220.54M, which, in comparison to the prior year’s level, has rocketed up by over 100%. Since these figures may be somewhat short-term, I’ve calculated an annualized five-year figure for CO’s earnings, which stands at CN¥113.07M This means generally, China Cord Blood has been able to steadily raise its profits over the past few years as well.
What’s the driver of this growth? Let’s take a look at whether it is solely owing to an industry uplift, or if China Cord Blood has seen some company-specific growth. The rise in earnings seems to be propelled by a robust top-line increase overtaking its growth rate of costs. Though this has led to a margin contraction, it has made China Cord Blood more profitable. Looking at growth from a sector-level, the US healthcare industry has been growing, albeit, at a muted single-digit rate of 8.71% in the previous twelve months, and a substantial 10.06% over the past five years. This shows that any tailwind the industry is enjoying, China Cord Blood is able to leverage this to its advantage.
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 China Cord Blood to get a more holistic view of the stock by looking at:
- 1. Future Outlook: What are well-informed industry analysts predicting for CO’s future growth? Take a look at our free research report of analyst consensus for CO’s outlook.
- 2. Financial Health: Is CO’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.