Examining Rand Logistics Inc’s (NASDAQ:RLOG) 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 RLOG’s latest performance announced on 30 September 2017 and compare these figures to its longer term trend and industry movements. See our latest analysis for Rand Logistics
Was RLOG weak performance lately part of a long-term decline?
I like to use data from the most recent 12 months, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This enables me to assess different companies in a uniform manner using new information. For Rand Logistics, the latest earnings -$23.8M, which, against the previous year’s level, has become more negative. Since these figures are somewhat nearsighted, I have computed an annualized five-year figure for RLOG’s earnings, which stands at -$7.2M. This doesn’t seem to paint a better picture, since earnings seem to have consistently been getting more and more negative over time.
Additionally, we can assess Rand Logistics’s loss by researching what has been happening in the industry as well as within the company. Firstly, I want to quickly look into the line items. Revenue growth over the past couple of years has been fairly soft, remaining flat on average at -1.25%. Since top-line growth is also pretty flat, the key to profitability going forward would be managing cost growth rates. Inspecting growth from a sector-level, the US shipping industry has been growing, albeit, at a unexciting single-digit rate of 4.28% in the past year, and 2.87% over the previous five years. This means whatever recent headwind the industry is facing, it’s hitting Rand Logistics harder than its peers.
What does this mean?
Though Rand Logistics’s past data is helpful, it is only one aspect of my investment thesis. Companies that incur net loss is always hard to forecast what will happen in the future and when. The most valuable step is to assess company-specific issues Rand Logistics may be facing and whether management guidance has consistently been met in the past. I recommend you continue to research Rand Logistics to get a more holistic view of the stock by looking at:
1. Financial Health: Is RLOG’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. 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.