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Measuring Willamette Valley Vineyards, Inc.'s (NASDAQ:WVVI) track record of past performance is an insightful exercise for investors. It enables us to reflect on whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess WVVI's recent performance announced on 31 March 2019 and compare these figures to its historical trend and industry movements.
Did WVVI perform worse than its track record and industry?
WVVI's trailing twelve-month earnings (from 31 March 2019) of US$1.9m has declined by -11% compared to the previous year.
Furthermore, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 4.2%, indicating the rate at which WVVI is growing has slowed down. Why could this be happening? Well, let's look at what's occurring with margins and if the entire industry is feeling the heat.
In terms of returns from investment, Willamette Valley Vineyards has fallen short of achieving a 20% return on equity (ROE), recording 6.2% instead. Furthermore, its return on assets (ROA) of 3.6% is below the US Beverage industry of 9.0%, indicating Willamette Valley Vineyards's are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Willamette Valley Vineyards’s debt level, has declined over the past 3 years from 9.7% to 7.0%.
What does this mean?
Though Willamette Valley Vineyards's past data is helpful, it is only one aspect of my investment thesis. Companies that are profitable, but have unpredictable earnings, can have many factors impacting its business. You should continue to research Willamette Valley Vineyards to get a more holistic view of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for WVVI’s future growth? Take a look at our free research report of analyst consensus for WVVI’s outlook.
- Financial Health: Are WVVI’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 2019. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.