Analyzing TNT Mines Limited’s (ASX:TIN) track record of past performance is a valuable exercise for investors. It enables us to reflect on whether or not the company has met expectations, which is a powerful signal for future performance. Today I will assess TIN’s recent performance announced on 30 June 2017 and compare these figures to its long-term trend and industry movements. View our latest analysis for TNT Mines
Could TIN beat the long-term trend and outperform its industry?
I look at the ‘latest twelve-month’ data, 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 allows me to analyze different stocks in a uniform manner using new information. TNT Mines’s latest earnings -A$0.3M, which, relative to the previous year’s figure, has become less negative. Given that these values may be fairly short-term thinking, I’ve determined an annualized five-year figure for TIN’s net income, which stands at -A$0.6M. This means although net income is negative, it has become less negative over the years.
We can further examine TNT Mines’s loss by researching what has been happening in the industry as well as within the company. First, I want to quickly look into the line items. Revenue growth over the past few years has been negative at -22.25%. The key to profitability here is to make sure the company’s cost growth is well-managed. Scanning growth from a sector-level, the Australian metals and mining industry has been growing, albeit, at a subdued single-digit rate of 7.36% in the previous year, and 8.50% over the past five. This means that, even though TNT Mines is presently unprofitable, it may have been aided by industry tailwinds, moving earnings in the right direction.
What does this mean?
Though TNT Mines’s past data is helpful, it is only one aspect of my investment thesis. Companies that incur net loss is always hard to forecast what will happen in the future and when. The most insightful step is to examine company-specific issues TNT Mines may be facing and whether management guidance has dependably been met in the past. You should continue to research TNT Mines to get a more holistic view of the stock by looking at:
1. Financial Health: Is TIN’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.
2. 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 last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. 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.