Does RTL Group SA’s (BDL:RTLL) 2.64% Earnings Growth Reflect The Long-Term Trend?
Examining RTL Group SA’s (BDL:RTLL) 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 RTLL’s latest performance announced on 31 December 2017 and weight these figures against its longer term trend and industry movements. View our latest analysis for RTL Group
Did RTLL’s recent earnings growth beat the long-term trend and the 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 technique allows me to examine various companies on a similar basis, using the latest information. For RTL Group, its most recent trailing-twelve-month earnings is €739.00M, which compared to the prior year’s figure, has grown by a somewhat muted 2.64%. Since these values are fairly myopic, I’ve created an annualized five-year figure for RTLL’s net income, which stands at €733.07M This shows that, on average, RTL Group has been able to steadily grow its profits over the last few years as well.
How has it been able to do this? Let’s see if it is only owing to an industry uplift, or if RTL Group has seen some company-specific growth. The hike in earnings seems to be bolstered by a strong top-line increase outstripping its growth rate of expenses. Though this has caused a margin contraction, it has made RTL Group more profitable. Eyeballing growth from a sector-level, the LU media industry has been growing its average earnings by double-digit 15.14% in the past year, and a more muted 8.66% over the last five years. This means whatever uplift the industry is deriving benefit from, RTL Group has not been able to leverage it as much as its average peer.
What does this mean?
RTL Group’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. While RTL Group has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. I recommend you continue to research RTL Group to get a more holistic view of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for RTLL’s future growth? Take a look at our free research report of analyst consensus for RTLL’s outlook.
Financial Health: Is RTLL’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 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.
