Yahoo Finance Does Kid ASA's (OB:KID) 23% Earnings Growth Make It An Outperformer?
Examining Kid ASA's (OB:KID) past track record of performance is an insightful exercise for investors. It allows us to reflect on whether or not the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess KID's latest performance announced on 31 December 2019 and compare these figures to its longer term trend and industry movements.
Check out our latest analysis for Kid
Could KID beat the long-term trend and outperform its industry?
KID's trailing twelve-month earnings (from 31 December 2019) of kr208m has jumped 23% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 16%, indicating the rate at which KID is growing has accelerated. How has it been able to do this? Well, let’s take a look at whether it is merely attributable to industry tailwinds, or if Kid has seen some company-specific growth.
In terms of returns from investment, Kid has fallen short of achieving a 20% return on equity (ROE), recording 18% instead. However, its return on assets (ROA) of 7.5% exceeds the NO Specialty Retail industry of 4.1%, indicating Kid has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Kid’s debt level, has increased over the past 3 years from 9.2% to 12%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 97% to 59% over the past 5 years.
What does this mean?
Kid's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. Companies that have performed well in the past, such as Kid gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I suggest you continue to research Kid to get a better picture of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for KID’s future growth? Take a look at our free research report of analyst consensus for KID’s outlook.
Financial Health: Are KID’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 2019. This may not be consistent with full year annual report figures.
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.
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. Thank you for reading.
