When LeMaitre Vascular, Inc.’s (NASDAQ:LMAT) announced its latest earnings (31 December 2018), I wanted to understand how these figures stacked up against its past performance. The two benchmarks I used were LeMaitre Vascular’s average earnings over the past couple of years, and its industry performance. These are useful yardsticks to help me gauge whether or not LMAT actually performed well. Below is a quick commentary on how I see LMAT has performed.
Did LMAT beat its long-term earnings growth trend and its industry?
LMAT’s trailing twelve-month earnings (from 31 December 2018) of US$23m has jumped 34% compared to the previous year.
However, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 40%, indicating the rate at which LMAT is growing has slowed down. To understand what’s happening, let’s take a look at what’s occurring with margins and if the whole industry is facing the same headwind.
In terms of returns from investment, LeMaitre Vascular has fallen short of achieving a 20% return on equity (ROE), recording 18% instead. However, its return on assets (ROA) of 15% exceeds the US Medical Equipment industry of 6.9%, indicating LeMaitre Vascular has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for LeMaitre Vascular’s debt level, has increased over the past 3 years from 14% to 16%.
What does this mean?
LeMaitre Vascular’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Companies that have performed well in the past, such as LeMaitre Vascular gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I suggest you continue to research LeMaitre Vascular to get a better picture of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for LMAT’s future growth? Take a look at our free research report of analyst consensus for LMAT’s outlook.
- Financial Health: Are LMAT’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 December 2018. This may not be consistent with full year annual report figures.
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