UP Global Sourcing Holdings plc (LON:UPGS): Has Recent Earnings Growth Beaten Long-Term Trend?
Measuring UP Global Sourcing Holdings plc’s (LSE:UPGS) 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 UPGS’s recent performance announced on 31 July 2017 and compare these figures to its historical trend and industry movements. Check out our latest analysis for UP Global Sourcing Holdings
How Well Did UPGS Perform?
For the purpose of this commentary, I like to 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 allows me to analyze various companies on a similar basis, using the latest information. For UP Global Sourcing Holdings, its most recent trailing-twelve-month earnings is UK£5.58M, which, against last year’s level, has jumped up by 13.82%. Since these figures may be somewhat nearsighted, I have created an annualized five-year figure for UPGS’s earnings, which stands at UK£1.95M This shows that, on average, UP Global Sourcing Holdings has been able to consistently improve its bottom line over the past couple of years as well.
What’s the driver of this growth? Let’s see if it is solely attributable to an industry uplift, or if UP Global Sourcing Holdings has seen some company-specific growth. Over the past couple of years, UP Global Sourcing Holdings grew its bottom line faster than revenue by successfully controlling its costs. This has led to a margin expansion and profitability over time. Looking at growth from a sector-level, the UK retail distributors industry has been growing, albeit, at a unexciting single-digit rate of 5.32% over the past twelve months, and 8.50% over the last five years. This shows that whatever tailwind the industry is enjoying, UP Global Sourcing Holdings is capable of leveraging this to its advantage.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Companies that have performed well in the past, such as UP Global Sourcing Holdings gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. You should continue to research UP Global Sourcing Holdings to get a better picture of the stock by looking at the areas below. Just a heads up – to access some parts of the Simply Wall St research tool you might be asked to create a free account, but it takes just one click and the information they provide is definitely worth it in my opinion.
1. Future Outlook: What are well-informed industry analysts predicting for UPGS’s future growth? Take a look at this free research report of analyst consensus for UPGS’s outlook.
2. Financial Health: Is UPGS’s operations financially sustainable? Balance sheets can be hard to analyze, which is why Simply Wall St does it for you. Check out important financial health checks here.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore a 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.
