Measuring Joyce Boutique Holdings Limited’s (SEHK:647) track record of past performance is a useful exercise for investors. It enables us to understand whether or not the company has met or exceed expectations, which is an insightful signal for future performance. Today I will assess 647’s recent performance announced on 30 September 2017 and weigh these figures against its long-term trend and industry movements. Check out our latest analysis for Joyce Boutique Holdings
Did 647 beat its long-term earnings growth trend and its industry?
I look at 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 method enables me to assess different stocks on a similar basis, using the latest information. For Joyce Boutique Holdings, its most recent bottom-line (trailing twelve month) is -HK$53.38M, which, against the previous year’s figure, has become less negative. Given that these values may be relatively short-term thinking, I have created an annualized five-year value for Joyce Boutique Holdings’s earnings, which stands at HK$37.79M.
We can further evaluate Joyce Boutique Holdings’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past half a decade Joyce Boutique Holdings has seen an annual decline in revenue of -4.13%, on average. This adverse movement is a driver of the company’s inability to reach breakeven. Has the entire industry experienced this headwind? Looking at growth from a sector-level, the HK specialty retail industry has been growing its average earnings by double-digit 19.05% in the past twelve months, . This is a turnaround from a volatile drop of -4.78% in the last few years. This means whatever uplift the industry is profiting from, Joyce Boutique Holdings has not been able to gain as much as its average peer.
What does this mean?
Joyce Boutique Holdings’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. With companies that are currently loss-making, it is always hard to envisage what will happen in the future and when. The most insightful step is to examine company-specific issues Joyce Boutique Holdings may be facing and whether management guidance has regularly been met in the past. I recommend you continue to research Joyce Boutique Holdings to get a more holistic view of the stock by looking at:
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Financial Health: Is 647’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 September 2017. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.