Does Cohen & Steers Inc’s (NYSE:CNS) 22.3% EPS Growth Reflect The Long-Term Trend?
After looking at Cohen & Steers Inc’s (NYSE:CNS) latest earnings update (30 September 2017), I found it helpful to revisit the company’s performance in the past couple of years and compare this against the latest numbers. As a long-term investor I tend to focus on earnings trend, rather than a single number at one point in time. Also, comparing it against an industry benchmark to understand whether it outperformed, or is simply riding an industry wave, is an important aspect. In this article I briefly touch on my key findings. Check out our latest analysis for Cohen & Steers
Could CNS beat the long-term trend and outperform its industry?
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 technique allows me to assess various companies on a similar basis, using new information. For Cohen & Steers, the latest twelve-month earnings is $97.7M, which, against the previous year’s figure, has risen by 23.44%. Given that these figures may be fairly myopic, I have estimated an annualized five-year figure for Cohen & Steers’s earnings, which stands at $69.6M. This suggests that, generally, Cohen & Steers has been able to steadily grow its earnings over the last couple of years as well.
How has it been able to do this? Well, let’s take a look at if it is merely a result of industry tailwinds, or if Cohen & Steers has seen some company-specific growth. In the last couple of years, Cohen & Steers increased its bottom line faster than revenue by effectively controlling its costs. This has led to a margin expansion and profitability over time. Inspecting growth from a sector-level, the US capital markets industry has been growing its average earnings by double-digit 17.00% in the previous twelve months, and 10.45% over the previous few years. This means whatever uplift the industry is enjoying, Cohen & Steers is able to amplify this to its advantage.
What does this mean?
While past data is useful, it doesn’t tell the whole story. While Cohen & Steers has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. I recommend you continue to research Cohen & Steers to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for CNS’s future growth? Take a look at our free research report of analyst consensus for CNS’s outlook.
2. Financial Health: Is CNS’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.
