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Has Tenax Therapeutics Inc (NASDAQ:TENX) Improved Earnings Growth In Recent Times?

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For investors, increase in profitability and industry-beating performance can be essential considerations in an investment. Below, I will examine Tenax Therapeutics Inc’s (NASDAQ:TENX) track record on a high level, to give you some insight into how the company has been performing against its long term trend and its industry peers. Check out our latest analysis for Tenax Therapeutics

Did TENX’s recent earnings growth beat the long-term trend and the industry?

For the purpose of this commentary, I like to use the ‘latest twelve-month’ data, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This method enables me to examine many different companies in a uniform manner using new information. For Tenax Therapeutics, its most recent bottom-line (trailing twelve month) is -US$6.74M, which, in comparison to the prior year’s level, has become less negative. Since these values are relatively myopic, I’ve created an annualized five-year figure for TENX’s net income, which stands at -US$18.92M. This means despite the fact that net income is negative, it has become less negative over the years.

NasdaqCM:TENX Income Statement Jun 11th 18
NasdaqCM:TENX Income Statement Jun 11th 18

We can further evaluate Tenax Therapeutics’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past half a decade Tenax Therapeutics has seen an annual decline in revenue of -39.60%, on average. This adverse movement is a driver of the company’s inability to reach breakeven. Has the entire industry experienced this headwind? Scanning growth from a sector-level, the US biotechs industry has been growing its average earnings by double-digit 21.75% in the past year, and 17.77% over the past five years. This means although Tenax Therapeutics is presently loss-making, it may have been aided by industry tailwinds, moving earnings into a more favorable position.

What does this mean?

While past data is useful, it doesn’t tell the whole story. With companies that are currently loss-making, it is always hard to forecast what will happen in the future and when. The most useful step is to examine company-specific issues Tenax Therapeutics may be facing and whether management guidance has steadily been met in the past. I suggest you continue to research Tenax Therapeutics to get a better picture of the stock by looking at:

  1. Future Outlook: What are well-informed industry analysts predicting for TENX’s future growth? Take a look at our free research report of analyst consensus for TENX’s outlook.

  2. Financial Health: Is TENX’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 trailing twelve months from 31 March 2018. 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.