How Does Forbuild SA’s (WSE:BTX) Earnings Growth Stack Up Against Industry Performance?
Examining Forbuild SA’s (WSE:BTX) past track record of performance is a valuable exercise for investors. It enables us to understand whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess BTX’s latest performance announced on 31 December 2017 and weigh these figures against its longer term trend and industry movements. Check out our latest analysis for Forbuild
How Did BTX’s Recent Performance Stack Up Against Its Past?
I prefer to use data from the most recent 12 months, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This method enables me to assess various companies on a similar basis, using new information. For Forbuild, its most recent trailing-twelve-month earnings is ZŁ3.94M, which, against the prior year’s figure, has soared up by more than double. Since these values are fairly myopic, I’ve created an annualized five-year value for BTX’s earnings, which stands at ZŁ3.08M This shows that, generally, Forbuild has been able to steadily grow its bottom line over the past few years as well.
What’s enabled this growth? Let’s take a look at if it is merely attributable to an industry uplift, or if Forbuild has seen some company-specific growth. In the last couple of years, Forbuild top-line expansion has outpaced earnings and the growth rate of expenses. Though this brought about a margin contraction, it has moderated Forbuild’s earnings contraction. Eyeballing growth from a sector-level, the PL construction industry has been growing, albeit, at a subdued single-digit rate of 3.72% in the previous year, and a flatter -1.53% over the past five years. This means that any near-term headwind the industry is enduring, Forbuild is relatively better-cushioned than its peers.
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? I recommend you continue to research Forbuild to get a more holistic view of the stock by looking at:
Financial Health: Is BTX’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.
Valuation: What is BTX worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether BTX is currently mispriced by the market.
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 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.
