Assessing Galaxy Surfactants Limited’s (NSE:GALAXYSURF) 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 GALAXYSURF’s recent performance announced on 31 December 2018 and evaluate these figures to its long-term trend and industry movements.

See our latest analysis for Galaxy Surfactants

Were GALAXYSURF’s earnings stronger than its past performances and the industry?

GALAXYSURF’s trailing twelve-month earnings (from 31 December 2018) of ₹1.7b has jumped 12% 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 18%, indicating the rate at which GALAXYSURF is growing has slowed down. To understand what’s happening, let’s take a look at what’s transpiring with margins and if the rest of the industry is experiencing the hit as well.

In terms of returns from investment, Galaxy Surfactants has invested its equity funds well leading to a 21% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 13% exceeds the IN Chemicals industry of 8.1%, indicating Galaxy Surfactants has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Galaxy Surfactants’s debt level, has increased over the past 3 years from 28% to 29%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 143% to 44% over the past 5 years.

What does this mean?

Galaxy Surfactants’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Companies that have performed well in the past, such as Galaxy Surfactants gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I recommend you continue to research Galaxy Surfactants to get a more holistic view of the stock by looking at:

1. Future Outlook: What are well-informed industry analysts predicting for GALAXYSURF’s future growth? Take a look at our free research report of analyst consensus for GALAXYSURF’s outlook.

2. Financial Health: Are GALAXYSURF’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.

3. 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 2018. This may not be consistent with full year annual report figures.

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.

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. Thank you for reading.