After looking at Tivoly SA.’s (ENXTPA:TVLY) latest earnings announcement (30 June 2017), I found it useful to revisit the company’s performance in the past couple of years and assess this against the most recent figures. As a long-term investor I tend to focus on earnings trend, rather than a single number at one point in time. Also, comparing it against an industry benchmark to understand whether it outperformed, or is simply riding an industry wave, is a crucial aspect. Below is a brief commentary on my key takeaways. Check out our latest analysis for Tivoly
How TVLY fared against its long-term earnings performance and its industry
To account for any quarterly or half-yearly updates, I use data from the most recent 12 months, which annualizes the most recent half-year data, or in some cases, the latest annual report is already the most recent financial year data. This enables me to analyze various companies in a uniform manner using the most relevant data points. For Tivoly, its most recent trailing-twelve-month earnings is €4.34M, which, in comparison to last year’s level, has jumped by a substantial 81.26%. Given that these values may be fairly nearsighted, I’ve estimated an annualized five-year value for TVLY’s earnings, which stands at €2.00M This shows that, on average, Tivoly has been able to consistently raise its earnings over the past few years as well.
What’s enabled this growth? Let’s see if it is merely owing to industry tailwinds, or if Tivoly has experienced some company-specific growth. Over the last couple of years, Tivoly increased its bottom line faster than revenue by efficiently controlling its costs. This has led to a margin expansion and profitability over time. Scanning growth from a sector-level, the FR machinery industry has been growing its average earnings by double-digit 25.23% in the prior twelve months, and 10.24% over the last five years. This shows that whatever uplift the industry is gaining from, Tivoly is capable of leveraging this to its advantage.
What does this mean?
Though Tivoly’s past data is helpful, it is only one aspect of my investment thesis. While Tivoly 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 Tivoly to get a better picture of the stock by looking at:
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Financial Health: Is TVLY’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 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.