Today I will take a look at Martin Midstream Partners LP’s (NASDAQ:MMLP) most recent earnings update (30 September 2017) and compare these latest figures against its performance over the past few years, as well as how the rest of the oil and gas industry performed. As an investor, I find it beneficial to assess MMLP’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. Check out our latest analysis for Martin Midstream Partners
How Did MMLP’s Recent Performance Stack Up Against Its Past?
To account for any quarterly or half-yearly updates, I use the ‘latest twelve-month’ data, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This technique enables me to analyze various companies in a uniform manner using the latest information. For Martin Midstream Partners, its most recent bottom-line (trailing twelve month) is $15.8M, which, in comparison to the prior year’s level, has climbed up by a significant 86.39%. Since these figures may be relatively nearsighted, I’ve computed an annualized five-year figure for Martin Midstream Partners’s net income, which stands at $9.6M. This suggests that, on average, Martin Midstream Partners has been able to gradually grow its profits over the last couple of years as well.
What’s enabled this growth? Well, let’s take a look at whether it is solely due to an industry uplift, or if Martin Midstream Partners has experienced some company-specific growth. Over the past couple of years, Martin Midstream Partners grew bottom-line, while its top-line fell, by effectively managing its costs. This brought about to a margin expansion and profitability over time. Viewing growth from a sector-level, the US oil and gas industry has been growing its average earnings by double-digit 17.75% in the prior twelve months, . This is a change from a volatile drop of -7.52% in the previous couple of years. This means that, in the recent industry expansion, Martin Midstream Partners is capable of amplifying this to its advantage.
What does this mean?
While past data is useful, it doesn’t tell the whole story. While Martin Midstream Partners has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. You should continue to research Martin Midstream Partners to get a more holistic view of the stock by looking at:
- 1. Future Outlook: What are well-informed industry analysts predicting for MMLP’s future growth? Take a look at our free research report of analyst consensus for MMLP’s outlook.
- 2. Financial Health: Is MMLP’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.