Where Image Sensing Systems Inc’s (NASDAQ:ISNS) Earnings Growth Stands Against Its Industry
In this article, I will take a look at Image Sensing Systems Inc’s (NASDAQ:ISNS) most recent earnings update (30 June 2018) and compare these latest figures against its performance over the past few years, along with how the rest of ISNS’s industry performed. As a long-term investor, I find it useful to analyze the company’s trend over time in order to estimate whether or not the company is able to meet its goals, and eventually grow sustainably over time.
See our latest analysis for Image Sensing Systems
Commentary On ISNS’s Past Performance
ISNS recently turned a profit of US$2.1m (most recent trailing twelve-months) compared to its average loss of -US$3.8m over the past five years.
In the past few years, Image Sensing Systems grew bottom-line, while its top-line declined, by efficiently controlling its costs. This has caused to a margin expansion and profitability over time.
Inspecting growth from a sector-level, the US electronic industry has been growing, albeit, at a unexciting single-digit rate of 3.9% in the prior twelve months, and 6.4% over the previous five years. This growth is a median of profitable companies of 25 Electronic companies in US including Bonso Electronics International, Coda Octopus Group and AmpliTech Group. This means whatever recent headwind the industry is experiencing, Image Sensing Systems is less exposed compared to its peers.
In terms of returns from investment, Image Sensing Systems has invested its equity funds well leading to a 22.2% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 17.8% exceeds the US Electronic industry of 6.0%, indicating Image Sensing Systems has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Image Sensing Systems’s debt level, has increased over the past 3 years from 6.8% to 26.4%.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Positive growth and profitability are what investors like to see in a company’s track record, but how do we properly assess sustainability? You should continue to research Image Sensing Systems to get a better picture of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for ISNS’s future growth? Take a look at our free research report of analyst consensus for ISNS’s outlook.
Financial Health: Are ISNS’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 30 June 2018. This may not be consistent with full year annual report figures.
To help readers see past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
