For long term investors, improvement in profitability and outperformance against the industry can be important characteristics in a stock. In this article, I will take a look at IsoRay Inc’s (AMEX:ISR) track record on a high level, to give you some insight into how the company has been performing against its historical trend and its industry peers. See our latest analysis for IsoRay
Did ISR perform worse than its track record and industry?
I prefer to 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 examine various companies on a more comparable basis, using the latest information. For IsoRay, its most recent earnings (trailing twelve month) is -US$6.21M, which, against the prior year’s figure, has become more negative. Since these values are relatively nearsighted, I’ve created an annualized five-year value for ISR’s earnings, which stands at -US$4.67M. This doesn’t look much better, as earnings seem to have steadily been getting more and more negative over time.
We can further evaluate IsoRay’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past five years IsoRay’s revenue growth has been relatively unexciting, with an annual growth rate of -0.0019%, on average. The company’s inability to breakeven has been aided by the relatively flat top-line in the past. Scanning growth from a sector-level, the US biotechs industry has been growing its average earnings by double-digit 21.75% over the prior twelve months, and 18.46% over the past five. This means whatever uplift the industry is deriving benefit from, IsoRay has not been able to gain as much as its industry peers.
What does this mean?
IsoRay’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. With companies that are currently loss-making, it is always difficult to predict what will happen in the future and when. The most insightful step is to examine company-specific issues IsoRay may be facing and whether management guidance has steadily been met in the past. You should continue to research IsoRay to get a more holistic view of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for ISR’s future growth? Take a look at our free research report of analyst consensus for ISR’s outlook.
- Financial Health: Is ISR’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 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.