Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
Understanding how Nederman Holding AB (publ) (STO:NMAN) is performing as a company requires looking at more than just a years' earnings. Today I will run you through a basic sense check to gain perspective on how Nederman Holding is doing by comparing its latest earnings with its long-term trend as well as the performance of its building industry peers.
Did NMAN beat its long-term earnings growth trend and its industry?
NMAN's trailing twelve-month earnings (from 30 June 2019) of kr223m has jumped 14% 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 16%, indicating the rate at which NMAN is growing has slowed down. To understand what's happening, let’s take a look at what’s going on with margins and if the rest of the industry is facing the same headwind.
In terms of returns from investment, Nederman Holding has fallen short of achieving a 20% return on equity (ROE), recording 17% instead. Furthermore, its return on assets (ROA) of 6.0% is below the SE Building industry of 6.4%, indicating Nederman Holding's are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Nederman Holding’s debt level, has declined over the past 3 years from 14% to 11%.
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 recommend you continue to research Nederman Holding to get a more holistic view of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for NMAN’s future growth? Take a look at our free research report of analyst consensus for NMAN’s outlook.
- Financial Health: Are NMAN’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.
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 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.