Analyzing Ten Entertainment Group Plc’s (LSE:TEG) 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 TEG’s recent performance announced on 02 July 2017 and compare these figures to its long-term trend and industry movements. View our latest analysis for Ten Entertainment Group
How Did TEG’s Recent Performance Stack Up Against Its Past?
For the most up-to-date info, I use the ‘latest twelve-month’ data, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This method enables me to analyze different companies in a uniform manner using new information. For Ten Entertainment Group, the latest twelve-month earnings is £1.5M, which, relative to the previous year’s figure, has fallen by -0.81%. Given that these figures may be somewhat nearsighted, I have calculated an annualized five-year value for TEG’s earnings, which stands at -£0.6M. This shows that, on average, Ten Entertainment Group has been able to improve its earnings over the last couple of years.
What’s the driver of this growth? Let’s take a look at if it is solely a result of industry tailwinds, or if Ten Entertainment Group has seen some company-specific growth. In the past couple of years, Ten Entertainment Group grew its bottom line faster than revenue by successfully controlling its costs. This has caused a margin expansion and profitability over time. Scanning growth from a sector-level, the UK hospitality industry has been growing its average earnings by double-digit 25.81% over the past twelve months, and 11.20% over the previous five years. This shows that any tailwind the industry is deriving benefit from, Ten Entertainment Group has not been able to reap as much as its industry peers.
What does this mean?
Though Ten Entertainment Group’s past data is helpful, it is only one aspect of my investment thesis. Companies are profitable, but have unpredictable earnings, can have many factors affecting its business. You should continue to research Ten Entertainment Group to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for TEG’s future growth? Take a look at our free research report of analyst consensus for TEG’s outlook.
2. Financial Health: Is TEG’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 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.