In This Article:
Examining China Resources Gas Group Limited's (SEHK:1193) 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 1193's latest performance announced on 30 June 2019 and compare these figures to its longer term trend and industry movements.
View our latest analysis for China Resources Gas Group
How 1193 fared against its long-term earnings performance and its industry
1193's trailing twelve-month earnings (from 30 June 2019) of HK$4.7b has jumped 13% compared to the previous year.
However, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 14%, indicating the rate at which 1193 is growing has slowed down. Why could this be happening? Well, let's examine what's transpiring with margins and whether the entire industry is experiencing the hit as well.
In terms of returns from investment, China Resources Gas Group has fallen short of achieving a 20% return on equity (ROE), recording 18% instead. However, its return on assets (ROA) of 6.2% exceeds the HK Gas Utilities industry of 5.1%, indicating China Resources Gas Group has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for China Resources Gas Group’s debt level, has increased over the past 3 years from 14% to 17%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 73% to 41% over the past 5 years.
What does this mean?
While past data is useful, it doesn’t tell the whole story. While China Resources Gas Group 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 China Resources Gas Group to get a better picture of the stock by looking at:
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Future Outlook: What are well-informed industry analysts predicting for 1193’s future growth? Take a look at our free research report of analyst consensus for 1193’s outlook.
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Financial Health: Are 1193’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.
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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 June 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 editorial-team@simplywallst.com. 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.
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