Yahoo Finance Has Howden Joinery Group Plc’s (LON:HWDN) Earnings Momentum Changed Recently?
Today I will examine Howden Joinery Group Plc’s (LSE:HWDN) latest earnings update (30 December 2017) and compare these figures against its performance over the past couple of years, in addition to how the rest of HWDN’s industry performed. As a long-term investor, I find it useful to analyze the company’s trend over time in order to estimate whether or not the company is able to meet its goals, and eventually grow sustainably over time. See our latest analysis for Howden Joinery Group
Was HWDN’s recent earnings decline worse than the long-term trend and the industry?
For the most up-to-date info, I use the ‘latest twelve-month’ data, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This method enables me to analyze many different companies on a more comparable basis, using the latest information. For Howden Joinery Group, its most recent trailing-twelve-month earnings is UK£185.00M, which, against the previous year’s figure, has plunged by -0.20%. Since these values may be somewhat short-term, I’ve determined an annualized five-year figure for HWDN’s net income, which stands at UK£135.89M This means that, generally, Howden Joinery Group has been able to increase its earnings over the past couple of years.
What’s the driver of this growth? Well, let’s take a look at whether it is only a result of industry tailwinds, or if Howden Joinery Group has experienced some company-specific growth. In the last few years, Howden Joinery Group increased its bottom line faster than revenue by effectively controlling its costs. This brought about a margin expansion and profitability over time. Looking at growth from a sector-level, the UK trade distributors industry has been growing its average earnings by double-digit 15.11% in the past year, and 12.95% over the last five years. This suggests that any tailwind the industry is deriving benefit from, Howden Joinery Group has not been able to realize the gains unlike its average peer.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Companies that are profitable, but have capricious earnings, can have many factors impacting its business. You should continue to research Howden Joinery Group to get a more holistic view of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for HWDN’s future growth? Take a look at our free research report of analyst consensus for HWDN’s outlook.
Financial Health: Is HWDN’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 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.
