Yahoo Finance Did PageGroup plc's (LON:PAGE) Recent Earnings Growth Beat The Trend?
After reading PageGroup plc's (LON:PAGE) latest earnings update (30 June 2019), I found it beneficial to look back at how the company has performed in the past and compare this against the most recent numbers. As a long-term investor I tend to pay attention to earnings trend, rather than a single number at one point in time. I also like to compare against an industry benchmark to understand whether PAGE has outperformed, or whether it is simply riding an industry wave. Below is a brief commentary on my key takeaways.
See our latest analysis for PageGroup
Were PAGE's earnings stronger than its past performances and the industry?
PAGE's trailing twelve-month earnings (from 30 June 2019) of UK£108m has jumped 18% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 14%, indicating the rate at which PAGE is growing has accelerated. How has it been able to do this? Let's see whether it is solely attributable to industry tailwinds, or if PageGroup has seen some company-specific growth.
In terms of returns from investment, PageGroup has invested its equity funds well leading to a 31% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 15% exceeds the GB Professional Services industry of 8.0%, indicating PageGroup has used its assets more efficiently. However, its return on capital (ROC), which also accounts for PageGroup’s debt level, has declined over the past 3 years from 40% to 32%.
What does this mean?
Though PageGroup's past data is helpful, it is only one aspect of my investment thesis. Companies that have performed well in the past, such as PageGroup gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I recommend you continue to research PageGroup to get a more holistic view of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for PAGE’s future growth? Take a look at our free research report of analyst consensus for PAGE’s outlook.
Financial Health: Are PAGE’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 30 June 2019. This may not be consistent with full year annual report figures.
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