Examining Advantech Co., Ltd.’s (TSEC:2395) 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 2395’s latest performance announced on 31 December 2019 and compare these figures to its longer term trend and industry movements.
Were 2395’s earnings stronger than its past performances and the industry?
2395’s trailing twelve-month earnings (from 31 December 2019) of NT$7.4b has jumped 17% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 7.9%, indicating the rate at which 2395 is growing has accelerated. What’s enabled this growth? Let’s see whether it is solely owing to an industry uplift, or if Advantech has experienced some company-specific growth.
In terms of returns from investment, Advantech has invested its equity funds well leading to a 23% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 15% exceeds the TW Tech industry of 4.3%, indicating Advantech has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Advantech’s debt level, has increased over the past 3 years from 24% to 26%.
What does this mean?
Advantech’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Positive growth and profitability are what investors like to see in a company’s track record, but how do we properly assess sustainability? You should continue to research Advantech to get a better picture of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for 2395’s future growth? Take a look at our free research report of analyst consensus for 2395’s outlook.
- Financial Health: Are 2395’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 firstname.lastname@example.org. 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.
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