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Does CNP Assurances SA's (EPA:CNP) Past Performance Indicate A Stronger Future?

Simply Wall St

Measuring CNP Assurances SA's (ENXTPA:CNP) track record of past performance is a useful exercise for investors. It enables us to understand whether or not the company has met or exceed expectations, which is an insightful signal for future performance. Today I will assess CNP's recent performance announced on 31 December 2019 and weigh these figures against its long-term trend and industry movements.

See our latest analysis for CNP Assurances

Could CNP beat the long-term trend and outperform its industry?

CNP's trailing twelve-month earnings (from 31 December 2019) of €1.4b has increased by 3.4% compared to the previous year.

However, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 6.5%, indicating the rate at which CNP is growing has slowed down. To understand what's happening, let's look at what's occurring with margins and whether the whole industry is experiencing the hit as well.

ENXTPA:CNP Income Statement March 26th 2020

In terms of returns from investment, CNP Assurances has fallen short of achieving a 20% return on equity (ROE), recording 8.2% instead. Furthermore, its return on assets (ROA) of 0.4% is below the FR Insurance industry of 1.5%, indicating CNP Assurances's are utilized less efficiently. However, its return on capital (ROC), which also accounts for CNP Assurances’s debt level, has increased over the past 3 years from 3.1% to 3.4%.

What does this mean?

CNP Assurances's track record can be a valuable insight into its earnings performance, but it certainly 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 CNP Assurances to get a better picture of the stock by looking at:

  1. Future Outlook: What are well-informed industry analysts predicting for CNP’s future growth? Take a look at our free research report of analyst consensus for CNP’s outlook.
  2. Financial Health: Are CNP’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 31 December 2019. This may not be consistent with full year annual report figures.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.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.

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. Thank you for reading.