Assessing Xenetic Biosciences Inc’s (NASDAQ:XBIO) past track record of performance is an insightful exercise for investors. It allows us to reflect on whether or not the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess XBIO’s recent performance announced on 30 September 2017 and evaluate these figures to its long-term trend and industry movements. Check out our latest analysis for Xenetic Biosciences
Were XBIO’s earnings stronger than its past performances and the industry?
I use data from the most recent 12 months, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This method enables me to analyze many different companies on a more comparable basis, using the most relevant data points. For Xenetic Biosciences, the most recent bottom-line -$12M, which compared to last year’s figure, has become less negative. Since these figures may be fairly myopic, I have determined an annualized five-year value for XBIO’s net income, which stands at -$15M. This shows that, although net income is negative, it has become less negative over the years.
We can further examine Xenetic Biosciences’s loss by researching what’s going on in the industry along with within the company. Initially, I want to quickly look into the line items. Revenue growth over past few years has grew by 29.14%, indicating that Xenetic Biosciences is in a high-growth period with expenses shooting ahead of elevated top-line growth rates. Viewing growth from a sector-level, the US biotechnology industry has been growing, albeit, at a subdued single-digit rate of 8.45% over the past year, and a substantial 22.54% over the previous few years. This shows that, though Xenetic Biosciences is presently unprofitable, it may have benefited from industry tailwinds, moving earnings in the right direction.
What does this mean?
Xenetic Biosciences’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 difficult to envisage what will happen in the future and when. The most insightful step is to examine company-specific issues Xenetic Biosciences may be facing and whether management guidance has regularly been met in the past. I recommend you continue to research Xenetic Biosciences to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for XBIO’s future growth? Take a look at our free research report of analyst consensus for XBIO’s outlook.
2. Financial Health: Is XBIO’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 last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. 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.