Does YouGov plc’s (LON:YOU) Recent Track Record Look Strong?
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 YouGov plc’s (AIM:YOU) 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. View our latest analysis for YouGov
How YOU fared against its long-term earnings performance and its industry
For the purpose of this commentary, I like to use the ‘latest twelve-month’ data, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This enables me to examine various companies in a uniform manner using the most relevant data points. For YouGov, its most recent trailing-twelve-month earnings is £4.7M, which, in comparison to the prior year’s figure, has risen by 37.34%. Given that these values are relatively short-term, I’ve estimated an annualized five-year figure for YOU’s earnings, which stands at £1.4M. This means that, generally, YouGov has been able to gradually raise its bottom line over the past few years as well.
What’s the driver of this growth? Well, let’s take a look at if it is solely attributable to an industry uplift, or if YouGov has experienced some company-specific growth. In the last few years, YouGov increased its bottom line faster than revenue by successfully controlling its costs. This has caused a margin expansion and profitability over time. Eyeballing growth from a sector-level, the UK media industry has been enduring some headwinds over the previous year, leading to an average earnings drop of -6.09%. This is a significant change, given that the industry has been delivering a positive rate of 7.65%, on average, over the previous five years. This means any near-term headwind the industry is enduring, YouGov is relatively better-cushioned than its peers.
What does this mean?
Though YouGov’s past data is helpful, it is only one aspect of my investment thesis. While YouGov has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. You should continue to research YouGov to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for YOU’s future growth? Take a look at our free research report of analyst consensus for YOU’s outlook.
2. Financial Health: Is YOU’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 July 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.
