Yahoo Finance Did NOTE AB (publ)'s (STO:NOTE) Recent Earnings Growth Beat The Trend?
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When NOTE AB (publ) (STO:NOTE) announced its most recent earnings (31 March 2019), I compared it against two factor: its historical earnings track record, and the performance of its industry peers on average. Being able to interpret how well NOTE has done so far requires weighing its performance against a benchmark, rather than looking at a standalone number at a point in time. In this article, I've summarized the key takeaways on how I see NOTE has performed.
View our latest analysis for NOTE
How Well Did NOTE Perform?
NOTE's trailing twelve-month earnings (from 31 March 2019) of kr72m has jumped 26% 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 27%, indicating the rate at which NOTE is growing has slowed down. Why could this be happening? Well, let’s take a look at what’s occurring with margins and if the entire industry is feeling the heat.
In terms of returns from investment, NOTE has fallen short of achieving a 20% return on equity (ROE), recording 17% instead. Furthermore, its return on assets (ROA) of 6.6% is below the SE Electronic industry of 7.4%, indicating NOTE's are utilized less efficiently. However, its return on capital (ROC), which also accounts for NOTE’s debt level, has increased over the past 3 years from 16% to 21%.
What does this mean?
Though NOTE's past data is helpful, it is only one aspect of my investment thesis. Positive growth and profitability are what investors like to see in a company’s track record, but how do we properly assess sustainability? I recommend you continue to research NOTE to get a better picture of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for NOTE’s future growth? Take a look at our free research report of analyst consensus for NOTE’s outlook.
Financial Health: Are NOTE’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 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.
