Examining Fibrocell Science Inc’s (NASDAQ:FCSC) past track record of performance is a useful exercise for investors. It allows us to reflect on whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess FCSC’s latest performance announced on 30 September 2017 and weight these figures against its longer term trend and industry movements. See our latest analysis for Fibrocell Science
Did FCSC’s recent earnings growth beat the long-term trend and the industry?
I like to 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 method allows me to assess different stocks on a more comparable basis, using the most relevant data points. For Fibrocell Science, its most recent trailing-twelve-month earnings is -US$26.80M, which, relative to last year’s figure, has become less negative. Since these figures are relatively myopic, I’ve estimated an annualized five-year value for Fibrocell Science’s earnings, which stands at -US$25.29M. This suggests that, Fibrocell Science has historically performed better than recently, despite the fact that it seems like earnings are now heading back towards a more favorable position once more.
We can further analyze Fibrocell Science’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the last five years Fibrocell Science’s top-line has grown by 20.30% on average, implying that the company is in a high-growth phase with expenses racing ahead revenues, leading to annual losses. Looking at growth from a sector-level, the US biotechs industry has been growing its average earnings by double-digit 24.94% in the prior year, and 19.51% over the previous five years. This suggests that any uplift the industry is enjoying, Fibrocell Science has not been able to leverage it as much as its average peer.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Companies that incur net loss is always hard to predict what will occur going forward, and when. The most useful step is to assess company-specific issues Fibrocell Science may be facing and whether management guidance has dependably been met in the past. I recommend you continue to research Fibrocell Science to get a better picture of the stock by looking at:
- 1. Future Outlook: What are well-informed industry analysts predicting for FCSC’s future growth? Take a look at our free research report of analyst consensus for FCSC’s outlook.
- 2. Financial Health: Is FCSC’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.