Analyzing Telephone and Data Systems, Inc.'s (NYSE:TDS) track record of past performance is a valuable exercise for investors. It enables us to reflect on whether or not the company has met expectations, which is a powerful signal for future performance. Today I will assess TDS's recent performance announced on 30 June 2019 and compare these figures to its long-term trend and industry movements.
How Did TDS's Recent Performance Stack Up Against Its Past?
TDS's trailing twelve-month earnings (from 30 June 2019) of US$155m has declined by -13% 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 38%, indicating the rate at which TDS is growing has slowed down. What could be happening here? Well, let’s take a look at what’s going on with margins and if the whole industry is facing the same headwind.
In terms of returns from investment, Telephone and Data Systems has fallen short of achieving a 20% return on equity (ROE), recording 3.4% instead. Furthermore, its return on assets (ROA) of 2.7% is below the US Wireless Telecom industry of 4.9%, indicating Telephone and Data Systems's are utilized less efficiently. However, its return on capital (ROC), which also accounts for Telephone and Data Systems’s debt level, has increased over the past 3 years from 2.1% to 2.1%.
What does this mean?
Telephone and Data Systems's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. Companies that are profitable, but have unpredictable earnings, can have many factors influencing its business. You should continue to research Telephone and Data Systems to get a more holistic view of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for TDS’s future growth? Take a look at our free research report of analyst consensus for TDS’s outlook.
- Financial Health: Are TDS’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 30 June 2019. This may not be consistent with full year annual report figures.
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.