Interested In WMIH Corp (NASDAQ:WMIH)? Here’s What Its Recent Performance Looks Like
When WMIH Corp’s (NASDAQ:WMIH) announced its latest earnings (30 September 2017), I wanted to understand how these figures stacked up against its past performance. The two benchmarks I used were WMIH’s average earnings over the past couple of years, and its industry performance. These are useful yardsticks to help me gauge whether or not WMIH actually performed well. Below is a quick commentary on how I see WMIH has performed. See our latest analysis for WMIH
Did WMIH’s recent earnings growth beat the long-term trend and the industry?
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 blend enables me to analyze different companies in a uniform manner using new information. “For WMIH, its “, most recent bottom-line is $54.5M, which compared to last year’s level, has soared up by more than double. Since these figures are somewhat myopic, I have computed an annualized five-year value for WMIH’s net income, which stands at -$5.3M. This suggests that, generally, WMIH has been able to steadily grow its bottom line over the last couple of years as well.
How has it been able to do this? Let’s take a look at whether it is merely because of industry tailwinds, or if WMIH has seen some company-specific growth. In the last couple of years, WMIH expanded bottom-line, while its top-line fell, by successfully controlling its costs. This has led to to a margin expansion and profitability over time. Eyeballing growth from a sector-level, the US insurance industry has been growing, albeit, at a subdued single-digit rate of 6.32% over the previous year, and 8.51% over the past five years. This means that any tailwind the industry is benefiting from, WMIH is able to leverage this to its advantage.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Positive growth and profitability are what investors like to see in a company’s track record, but how do we properly assess sustainability? I suggest you continue to research WMIH to get a better picture of the stock by looking at:
1. Financial Health: Is WMIH’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.
2. Valuation: What is WMIH worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether WMIH is currently mispriced by the market.
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 last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. 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.
