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Interested In SEB SA (EPA:SK)? Here's What Its Recent Performance Looks Like

Simply Wall St

In this article, I will take a look at SEB SA's (ENXTPA:SK) most recent earnings update (30 June 2019) and compare these latest figures against its performance over the past few years, along with how the rest of SK'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 SEB

How Did SK's Recent Performance Stack Up Against Its Past?

SK's trailing twelve-month earnings (from 30 June 2019) of €428m has jumped 12% compared to the previous year.

However, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 21%, indicating the rate at which SK is growing has slowed down. To understand what's happening, let's look at what's going on with margins and whether the rest of the industry is experiencing the hit as well.

ENXTPA:SK Income Statement, October 11th 2019

In terms of returns from investment, SEB has invested its equity funds well leading to a 20% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 5.9% exceeds the FR Consumer Durables industry of 3.6%, indicating SEB has used its assets more efficiently. However, its return on capital (ROC), which also accounts for SEB’s debt level, has declined over the past 3 years from 15% to 13%. This correlates with an increase in debt holding, with debt-to-equity ratio rising from 60% to 117% over the past 5 years.

What does this mean?

Though SEB's past data is helpful, it is only one aspect of my investment thesis. Companies that have performed well in the past, such as SEB gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. You should continue to research SEB to get a more holistic view of the stock by looking at:

  1. Future Outlook: What are well-informed industry analysts predicting for SK’s future growth? Take a look at our free research report of analyst consensus for SK’s outlook.
  2. Financial Health: Are SK’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 30 June 2019. This may not be consistent with full year annual report figures.

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.

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. Thank you for reading.