When NTN Buzztime Inc (AMEX:NTN) announced its most recent earnings (31 December 2017), I did two things: looked at its past earnings track record, then look at what is happening in the industry. Understanding how NTN Buzztime performed requires a benchmark rather than trying to assess a standalone number at one point in time. Below is a quick commentary on how I see NTN has performed. Check out our latest analysis for NTN Buzztime
Did NTN beat its long-term earnings growth trend and its industry?
For the most up-to-date info, I 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 enables me to examine various companies on a similar basis, using new information. For NTN Buzztime, its most recent trailing-twelve-month earnings is -US$1.08M, which compared to last year’s level, has become less negative. Given that these values may be relatively myopic, I’ve estimated an annualized five-year figure for NTN’s earnings, which stands at -US$2.99M. This means that, even though net income is negative, it has become less negative over the years.
We can further examine NTN Buzztime’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past five years NTN Buzztime’s revenue growth has been somewhat soft, with an annual growth rate of -1.25%, on average. The company’s inability to breakeven has been aided by the relatively flat top-line in the past. Looking at growth from a sector-level, the US media industry has been growing its average earnings by double-digit 18.92% over the prior twelve months, and a more muted 7.56% over the last five years. This means although NTN Buzztime is currently loss-making, it may have been aided by industry tailwinds, moving earnings towards to right direction.
What does this mean?
NTN Buzztime’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. With companies that are currently loss-making, it is always hard to envisage what will occur going forward, and when. The most insightful step is to assess company-specific issues NTN Buzztime may be facing and whether management guidance has regularly been met in the past. I suggest you continue to research NTN Buzztime to get a more holistic view of the stock by looking at:
- 1. Future Outlook: What are well-informed industry analysts predicting for NTN’s future growth? Take a look at our free research report of analyst consensus for NTN’s outlook.
- 2. Financial Health: Is NTN’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 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.