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Increase in profitability and industry-beating performance can be essential considerations in a stock for some investors. In this article, I will take a look at Standrew S.A.'s (WSE:STD) track record on a high level, to give you some insight into how the company has been performing against its historical trend and its industry peers.
How STD fared against its long-term earnings performance and its industry
STD's trailing twelve-month earnings (from 31 December 2018) of zł459k has jumped 28% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of -12%, indicating the rate at which STD is growing has accelerated. What's the driver of this growth? Well, let’s take a look at whether it is merely due to an industry uplift, or if Standrew has experienced some company-specific growth.
In terms of returns from investment, Standrew has fallen short of achieving a 20% return on equity (ROE), recording 8.9% instead. However, its return on assets (ROA) of 4.8% exceeds the PL Forestry industry of 4.7%, indicating Standrew has used its assets more efficiently. Though, its return on capital (ROC), which also accounts for Standrew’s debt level, has declined over the past 3 years from 16% to 13%.
What does this mean?
Though Standrew's past data is helpful, it is only one aspect of my investment thesis. Recent positive growth doesn’t necessarily mean it’s onwards and upwards for the company. There could be variables that are affecting the industry as a whole, thus the high industry growth rate over the same time frame. I recommend you continue to research Standrew to get a better picture of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for STD’s future growth? Take a look at our free research report of analyst consensus for STD’s outlook.
- Financial Health: Are STD’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 firstname.lastname@example.org. 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.