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Should You Be Happy With WESCO International, Inc.'s (NYSE:WCC) Performance Lately?

Simply Wall St
·3 mins read

Examining WESCO International, Inc.'s (NYSE:WCC) past track record of performance is a valuable exercise for investors. It enables us to understand whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess WCC's latest performance announced on 31 December 2019 and weigh these figures against its longer term trend and industry movements.

View our latest analysis for WESCO International

Did WCC's recent earnings growth beat the long-term trend and the industry?

WCC's trailing twelve-month earnings (from 31 December 2019) of US$223m has declined by -1.7% compared to the previous year.

Furthermore, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of -2.1%, indicating the rate at which WCC is growing has slowed down. Why could this be happening? Well, let's look at what's occurring with margins and if the entire industry is feeling the heat.

NYSE:WCC Income Statement, February 12th 2020
NYSE:WCC Income Statement, February 12th 2020

In terms of returns from investment, WESCO International has fallen short of achieving a 20% return on equity (ROE), recording 9.8% instead. Furthermore, its return on assets (ROA) of 5.7% is below the US Trade Distributors industry of 6.6%, indicating WESCO International's are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for WESCO International’s debt level, has declined over the past 3 years from 9.3% to 8.9%.

What does this mean?

While past data is useful, it doesn’t tell the whole story. Companies that are profitable, but have volatile earnings, can have many factors impacting its business. I recommend you continue to research WESCO International to get a more holistic view of the stock by looking at:

  1. Future Outlook: What are well-informed industry analysts predicting for WCC’s future growth? Take a look at our free research report of analyst consensus for WCC’s outlook.

  2. Financial Health: Are WCC’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 December 2019. This may not be consistent with full year annual report figures.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.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.

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. Thank you for reading.