Yahoo Finance With 21% Earnings Growth, Did Tomra Systems ASA (OB:TOM) Outperform The Industry?
Want to participate in a research study? Help shape the future of investing tools and earn a $60 gift card!
For investors with a long-term horizon, examining earnings trend over time and against industry peers is more insightful than looking at an earnings announcement in one point in time. Investors may find my commentary, albeit very high-level and brief, on Tomra Systems ASA (OB:TOM) useful as an attempt to give more color around how Tomra Systems is currently performing.
Check out our latest analysis for Tomra Systems
How TOM fared against its long-term earnings performance and its industry
TOM's trailing twelve-month earnings (from 31 December 2018) of øre740m has jumped 21% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 12%, indicating the rate at which TOM is growing has accelerated. What's enabled this growth? Well, let’s take a look at if it is only a result of an industry uplift, or if Tomra Systems has experienced some company-specific growth.
In terms of returns from investment, Tomra Systems has fallen short of achieving a 20% return on equity (ROE), recording 15% instead. However, its return on assets (ROA) of 8.2% exceeds the NO Commercial Services industry of 5.3%, indicating Tomra Systems has used its assets more efficiently. Though, its return on capital (ROC), which also accounts for Tomra Systems’s debt level, has declined over the past 3 years from 16% to 12%.
What does this mean?
Tomra Systems's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. While Tomra Systems has a good historical track record with positive growth and profitability, there's no certainty that this will extrapolate into the future. I suggest you continue to research Tomra Systems to get a better picture of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for TOM’s future growth? Take a look at our free research report of analyst consensus for TOM’s outlook.
Financial Health: Are TOM’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.
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 editorial-team@simplywallst.com. 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.
