In This Article:
Improvement in profitability and outperformance against the industry can be important characteristics in a stock for some investors. Below, I will assess Kesko Oyj's (HEL:KESKOB) track record on a high level, to give you some insight into how the company has been performing against its historical trend and its industry peers.
See our latest analysis for Kesko Oyj
Did KESKOB beat its long-term earnings growth trend and its industry?
KESKOB's trailing twelve-month earnings (from 30 June 2019) of €247m has jumped 21% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 20%, indicating the rate at which KESKOB is growing has accelerated. What's enabled this growth? Well, let’s take a look at if it is solely due to an industry uplift, or if Kesko Oyj has experienced some company-specific growth.
In terms of returns from investment, Kesko Oyj has fallen short of achieving a 20% return on equity (ROE), recording 13% instead. Furthermore, its return on assets (ROA) of 3.5% is below the FI Consumer Retailing industry of 5.0%, indicating Kesko Oyj's are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Kesko Oyj’s debt level, has declined over the past 3 years from 10% to 7.2%. This correlates with an increase in debt holding, with debt-to-equity ratio rising from 23% to 33% over the past 5 years.
What does this mean?
While past data is useful, it doesn’t tell the whole story. While Kesko Oyj has a good historical track record with positive growth and profitability, there's no certainty that this will extrapolate into the future. You should continue to research Kesko Oyj 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 KESKOB’s future growth? Take a look at our free research report of analyst consensus for KESKOB’s outlook.
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Financial Health: Are KESKOB’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.
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.