Interested In Brooks Macdonald Group plc (LON:BRK)? Here’s How It Performed Recently
Today I will examine Brooks Macdonald Group plc’s (AIM:BRK) latest earnings update (31 December 2017) and compare these figures against its performance over the past couple of years, in addition to how the rest of BRK’s industry performed. As a long-term investor, I find it useful to analyze the company’s trend over time in order to estimate whether or not the company is able to meet its goals, and eventually grow sustainably over time. Check out our latest analysis for Brooks Macdonald Group
Was BRK’s recent earnings decline indicative of a tough track record?
To account for any quarterly or half-yearly updates, I use data from the most recent 12 months, 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 technique enables me to examine many different companies on a similar basis, using new information. For Brooks Macdonald Group, its latest earnings (trailing twelve month) is -UK£1.22M, which, relative to the previous year’s figure, has turned from positive to negative. Given that these values may be relatively short-term thinking, I have created an annualized five-year figure for Brooks Macdonald Group’s earnings, which stands at UK£8.10M.
We can further analyze Brooks Macdonald Group’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past half a decade Brooks Macdonald Group’s top-line has grown by a mere 9.74%, on average. The company’s inability to breakeven has been aided by the relatively flat top-line in the past. Looking at growth from a sector-level, the UK capital markets industry has been growing its average earnings by double-digit 33.95% in the past year, and 19.03% over the past five years. This means whatever uplift the industry is profiting from, Brooks Macdonald Group has not been able to leverage it as much as its average peer.
What does this mean?
Brooks Macdonald Group’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 hard to predict what will happen in the future and when. The most useful step is to assess company-specific issues Brooks Macdonald Group may be facing and whether management guidance has consistently been met in the past. I recommend you continue to research Brooks Macdonald Group to get a better picture of the stock by looking at:
Financial Health: Is BRK’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 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.
