Examining Crusader Resources Limited’s (ASX:CAS) past track record of performance is a useful exercise for investors. It allows us to reflect on whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess CAS’s latest performance announced on 30 June 2017 and weight these figures against its longer term trend and industry movements. View our latest analysis for Crusader Resources
Commentary On CAS’s Past Performance
I like to use data from the most recent 12 months, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This allows me to analyze many different companies on a more comparable basis, using the latest information. For Crusader Resources, the most recent earnings -A$10.8M, which, relative to the previous year’s level, has become more negative. Given that these figures are somewhat short-term thinking, I’ve determined an annualized five-year value for CAS’s earnings, which stands at -A$8.6M. This doesn’t look much better, since earnings seem to have steadily been getting more and more negative over time.
Additionally, we can examine Crusader Resources’s loss by researching what has been happening in the industry as well as within the company. First, I want to quickly look into the line items. Revenue growth over the past couple of years has grown by 23.37%, signalling that Crusader Resources is in a high-growth phase with expenses racing ahead elevated top-line growth rates. Viewing growth from a sector-level, the Australian metals and mining industry has been growing, albeit, at a subdued single-digit rate of 7.36% over the past year, and 8.50% over the past five. This shows that whatever uplift the industry is profiting from, Crusader Resources has not been able to realize the gains unlike its average peer.
What does this mean?
Crusader Resources’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Companies that incur net loss is always difficult to envisage what will happen in the future and when. The most valuable step is to examine company-specific issues Crusader Resources may be facing and whether management guidance has consistently been met in the past. I suggest you continue to research Crusader Resources to get a more holistic view of the stock by looking at:
1. Financial Health: Is CAS’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.