Yahoo Finance Koninklijke Ahold Delhaize NV. (AMS:AD): Has Recent Earnings Growth Beaten Long-Term Trend?
After looking at Koninklijke Ahold Delhaize NV.’s (ENXTAM:AD) latest earnings announcement (01 April 2018), I found it useful to revisit the company’s performance in the past couple of years and assess this against the most recent figures. As a long term investor, I pay close attention to earnings trend, rather than the figures published at one point in time. I also compare against an industry benchmark to check whether Koninklijke Ahold Delhaize’s performance has been impacted by industry movements. In this article I briefly touch on my key findings. View our latest analysis for Koninklijke Ahold Delhaize
How Well Did AD Perform?
I prefer to use data from the most recent 12 months, which annualizes the most recent half-year data, or in some cases, the latest annual report is already the most recent financial year data. This technique enables me to assess different stocks on a similar basis, using the latest information. For Koninklijke Ahold Delhaize, its latest trailing-twelve-month earnings is €1.87B, which compared to last year’s figure, has climbed up by a significant 90.93%. Given that these figures are fairly short-term, I’ve determined an annualized five-year figure for AD’s net income, which stands at €957.57M This suggests that, generally, Koninklijke Ahold Delhaize has been able to steadily improve its profits over the last couple of years as well.
What’s the driver of this growth? Let’s see if it is solely attributable to an industry uplift, or if Koninklijke Ahold Delhaize has seen some company-specific growth. The ascend in earnings seems to be supported by a solid top-line increase overtaking its growth rate of expenses. Though this has caused a margin contraction, it has made Koninklijke Ahold Delhaize more profitable. Scanning growth from a sector-level, the NL consumer retailing industry has been growing its average earnings by double-digit 14.62% in the previous twelve months, and a less exciting 5.44% over the past half a decade. This means whatever uplift the industry is benefiting from, Koninklijke Ahold Delhaize is able to amplify this to its advantage.
What does this mean?
Though Koninklijke Ahold Delhaize’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 Koninklijke Ahold Delhaize to get a better picture of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for AD’s future growth? Take a look at our free research report of analyst consensus for AD’s outlook.
Financial Health: Is AD’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 01 April 2018. 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.