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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 Schindler Holding AG (VTX:SCHN) useful as an attempt to give more color around how Schindler Holding is currently performing.
Check out our latest analysis for Schindler Holding
Did SCHN beat its long-term earnings growth trend and its industry?
SCHN's trailing twelve-month earnings (from 31 March 2019) of CHF932m has increased by 9.3% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 7.1%, indicating the rate at which SCHN is growing has accelerated. What's the driver of this growth? Well, let’s take a look at whether it is merely a result of an industry uplift, or if Schindler Holding has experienced some company-specific growth.
In terms of returns from investment, Schindler Holding has invested its equity funds well leading to a 26% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 8.4% exceeds the CH Machinery industry of 6.8%, indicating Schindler Holding has used its assets more efficiently. However, its return on capital (ROC), which also accounts for Schindler Holding’s debt level, has declined over the past 3 years from 30% to 23%.
What does this mean?
Schindler Holding's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. While Schindler Holding has a good historical track record with positive growth and profitability, there's no certainty that this will extrapolate into the future. I recommend you continue to research Schindler Holding 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 SCHN’s future growth? Take a look at our free research report of analyst consensus for SCHN’s outlook.
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Financial Health: Are SCHN’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 31 March 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.