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Measuring Sogeclair SA's (EPA:SOG) track record of past performance is a valuable exercise for investors. It allows us to understand whether or not the company has met or exceed expectations, which is an insightful signal for future performance. Today I will assess SOG's recent performance announced on 31 December 2018 and compare these figures to its historical trend and industry movements.
Could SOG beat the long-term trend and outperform its industry?
SOG's trailing twelve-month earnings (from 31 December 2018) of €6.3m has jumped 15% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 2.6%, indicating the rate at which SOG is growing has accelerated. How has it been able to do this? Let's take a look at if it is only due to industry tailwinds, or if Sogeclair has seen some company-specific growth.
In terms of returns from investment, Sogeclair has fallen short of achieving a 20% return on equity (ROE), recording 12% instead. However, its return on assets (ROA) of 4.2% exceeds the FR Aerospace & Defense industry of 3.6%, indicating Sogeclair has used its assets more efficiently. Though, its return on capital (ROC), which also accounts for Sogeclair’s debt level, has declined over the past 3 years from 9.1% to 8.4%. This correlates with an increase in debt holding, with debt-to-equity ratio rising from 41% to 74% over the past 5 years.
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 Sogeclair to get a more holistic view of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for SOG’s future growth? Take a look at our free research report of analyst consensus for SOG’s outlook.
- Financial Health: Are SOG’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 2018. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.