Assessing Flexible Solutions International Inc’s (AMEX:FSI) 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 FSI’s recent performance announced on 31 March 2018 and evaluate these figures to its long-term trend and industry movements. View our latest analysis for Flexible Solutions International
Was FSI’s recent earnings decline worse than the long-term trend and the industry?
I look at 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 method enables me to examine various companies on a similar basis, using the most relevant data points. For Flexible Solutions International, its most recent trailing-twelve-month earnings is -US$794.26K, which, against the prior year’s level, has turned from positive to negative. Since these figures are relatively short-term, I’ve calculated an annualized five-year figure for FSI’s earnings, which stands at US$1.00M.
We can further assess Flexible Solutions International’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the last five years Flexible Solutions International’s revenue growth has been fairly soft, with an annual growth rate of 0.63%, on average. The company’s inability to breakeven has been aided by the relatively flat top-line in the past. Scanning growth from a sector-level, the US chemicals industry has been growing its average earnings by double-digit 18.68% in the past year, and a more subdued 6.17% over the past half a decade. This means whatever uplift the industry is enjoying, Flexible Solutions International has not been able to reap as much as its average peer.
What does this mean?
Flexible Solutions International’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 forecast what will happen in the future and when. The most insightful step is to assess company-specific issues Flexible Solutions International may be facing and whether management guidance has consistently been met in the past. You should continue to research Flexible Solutions International to get a more holistic view of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for FSI’s future growth? Take a look at our free research report of analyst consensus for FSI’s outlook.
- Financial Health: Is FSI’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 March 2018. 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.