Measuring StoneMor Partners LP.’s (NYSE:STON) track record of past performance is a valuable exercise for investors. It allows us to understand whether or not the company has met or exceed expectations, which is an insightful signal for future performance. Today I will assess STON’s recent performance announced on 30 September 2017 and compare these figures to its historical trend and industry movements. View our latest analysis for StoneMor Partners
How Well Did STON Perform?
I prefer to use data from the most recent 12 months, 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 blend allows me to examine many different companies in a uniform manner using new information. For StoneMor Partners, its most recent trailing-twelve-month earnings is -US$35.34M, which compared to the previous year’s level, has become more negative. Given that these figures may be somewhat short-term, I have computed an annualized five-year value for STON’s net income, which stands at -US$17.92M. This doesn’t seem to paint a better picture, as earnings seem to have consistently been getting more and more negative over time.
We can further analyze StoneMor Partners’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past five years StoneMor Partners’s top-line has grown by a mere 7.80%, on average. The company’s inability to breakeven has been aided by the relatively flat top-line in the past. Inspecting growth from a sector-level, the US consumer services industry has been ramping up average earnings growth of 51.95% over the past twelve months, and a more muted 6.84% over the previous five years. This means that any uplift the industry is deriving benefit from, StoneMor Partners has not been able to realize the gains unlike its average peer.
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 difficult to predict what will occur going forward, and when. The most useful step is to examine company-specific issues StoneMor Partners may be facing and whether management guidance has dependably been met in the past. I suggest you continue to research StoneMor Partners to get a better picture of the stock by looking at:
- 1. Future Outlook: What are well-informed industry analysts predicting for STON’s future growth? Take a look at our free research report of analyst consensus for STON’s outlook.
- 2. Financial Health: Is STON’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 30 September 2017. 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.