Yahoo Finance With A -28.13% Earnings Drop, Did Albert Technologies Ltd (LON:ALB) Really Underperform?
When Albert Technologies Ltd (AIM:ALB) released its most recent earnings update (31 December 2017), I compared it against two factor: its historical earnings track record, and the performance of its industry peers on average. Understanding how Albert Technologies performed requires a benchmark rather than trying to assess a standalone number at one point in time. Below is a quick commentary on how I see ALB has performed. See our latest analysis for Albert Technologies
Did ALB perform worse than its track record and industry?
For the most up-to-date info, I 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 method allows me to assess different stocks in a uniform manner using the latest information. For Albert Technologies, its most recent earnings (trailing twelve month) is -US$11.81M, which, relative to last year’s figure, has become more negative. Since these values are somewhat nearsighted, I have computed an annualized five-year figure for ALB’s net income, which stands at -US$5.07M. This doesn’t seem to paint a better picture, since earnings seem to have consistently been getting more and more negative over time.
We can further examine Albert Technologies’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past half a decade Albert Technologies’s top-line has risen by a mere 4.37%, on average. The company’s inability to breakeven has been aided by the relatively flat top-line in the past. Viewing growth from a sector-level, the UK internet industry has been growing its average earnings by double-digit 11.24% in the prior year, and 20.38% over the past half a decade. This shows that any tailwind the industry is deriving benefit from, Albert Technologies has not been able to leverage it as much as its industry peers.
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 hard to predict what will happen in the future and when. The most valuable step is to assess company-specific issues Albert Technologies may be facing and whether management guidance has steadily been met in the past. I suggest you continue to research Albert Technologies to get a more holistic view of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for ALB’s future growth? Take a look at our free research report of analyst consensus for ALB’s outlook.
Financial Health: Is ALB’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 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.
