For investors with a long-term horizon, examining earnings trend over time and against industry peers is more insightful than looking at an earnings announcement in one point in time. Investors may find my commentary, albeit very high-level and brief, on BP Marsh & Partners PLC (AIM:BPM) useful as an attempt to give more color around how B.P. Marsh & Partners is currently performing. Check out our latest analysis for B.P. Marsh & Partners
Commentary On BPM’s Past Performance
I use the ‘latest twelve-month’ data, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This blend enables me to analyze various companies in a uniform manner using new information. B.P. Marsh & Partners’s most recent bottom-line is £16.0M, which, relative to the previous year’s level, has jumped by a significant 70.96%. Given that these values are fairly short-term thinking, I have determined an annualized five-year figure for B.P. Marsh & Partners’s net income, which stands at £6.1M. This means on average, B.P. Marsh & Partners has been able to consistently raise its bottom line over the past few years as well.
What’s the driver of this growth? Well, let’s take a look at if it is merely because of an industry uplift, or if B.P. Marsh & Partners has seen some company-specific growth. In the last few years, B.P. Marsh & Partners expanded its bottom line faster than revenue by successfully controlling its costs. This has caused a margin expansion and profitability over time. Inspecting growth from a sector-level, the UK capital markets industry has been growing its average earnings by double-digit 23.46% over the prior twelve months, and 12.40% over the past couple of years. This means whatever uplift the industry is gaining from, B.P. Marsh & Partners is able to leverage this to its advantage.
What does this mean?
Though B.P. Marsh & Partners’s past data is helpful, it is only one aspect of my investment thesis. While B.P. Marsh & Partners has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. I suggest you continue to research B.P. Marsh & Partners to get a more holistic view of the stock by looking at:
1. Financial Health: Is BPM’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.