Today I will take a look at Corby Spirit and Wine Limited’s (TSE:CSW.A) most recent earnings update (30 September 2018) and compare these latest figures against its performance over the past few years, as well as how the rest of the beverage industry performed. As an investor, I find it beneficial to assess CSW.A’s trend over the short-to-medium term in order to gauge whether or not the company is able to meet its goals, and ultimately sustainably grow over time.
How Well Did CSW.A Perform?
CSW.A’s trailing twelve-month earnings (from 30 September 2018) of CA$26m has increased by 5.1% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 1.4%, indicating the rate at which CSW.A is growing has accelerated. What’s the driver of this growth? Let’s see if it is solely because of industry tailwinds, or if Corby Spirit and Wine has experienced some company-specific growth.
In terms of returns from investment, Corby Spirit and Wine has fallen short of achieving a 20% return on equity (ROE), recording 14% instead. However, its return on assets (ROA) of 11% exceeds the CA Beverage industry of 3.7%, indicating Corby Spirit and Wine has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Corby Spirit and Wine’s debt level, has increased over the past 3 years from 14% to 18%.
What does this mean?
Corby Spirit and Wine’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Recent positive growth doesn’t necessarily mean it’s onwards and upwards for the company. There may be factors that are impacting the industry as a whole, hence the high industry growth rate over the same time frame. You should continue to research Corby Spirit and Wine to get a better picture of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for CSW.A’s future growth? Take a look at our free research report of analyst consensus for CSW.A’s outlook.
- Financial Health: Are CSW.A’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 30 September 2018. This may not be consistent with full year annual report figures.
To help readers see past 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. For errors that warrant correction please contact the editor at email@example.com.