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 Gujarat NRE Coke Limited (NSEI:GUJNRECOKE) useful as an attempt to give more color around how Gujarat NRE Coke is currently performing. Check out our latest analysis for Gujarat NRE Coke
Did GUJNRECOKE’s recent earnings growth beat the long-term trend and the industry?
To account for any quarterly or half-yearly updates, I use the ‘latest twelve-month’ data, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This blend enables me to analyze many different companies in a uniform manner using the most relevant data points. For Gujarat NRE Coke, its latest earnings is -₹7,337.4M, which, against the previous year’s level, has become less negative. Given that these values may be relatively myopic, I’ve estimated an annualized five-year figure for GUJNRECOKE’s earnings, which stands at -₹3,378.8M. This suggests that, Gujarat NRE Coke has historically performed better than recently, despite the fact that it seems like earnings are now heading back towards to right direction again.
Additionally, we can evaluate Gujarat NRE Coke’s loss by researching what has been happening in the industry as well as within the company. Firstly, I want to briefly look into the line items. Revenue growth over the past couple of years has been negative at -22.15%. The key to profitability here is to make sure the company’s cost growth is well-controlled. Scanning growth from a sector-level, the IN metals and mining industry has been growing its average earnings by double-digit 27.08% in the past twelve months, and a more muted 3.25% over the past five years. This suggests that whatever tailwind the industry is deriving benefit from, Gujarat NRE Coke has not been able to gain as much as its industry peers.
What does this mean?
Gujarat NRE Coke’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Companies that incur net loss is always difficult to predict what will happen in the future and when. The most insightful step is to examine company-specific issues Gujarat NRE Coke may be facing and whether management guidance has steadily been met in the past. I recommend you continue to research Gujarat NRE Coke to get a better picture of the stock by looking at: