Today I will take a look at SEACOR Marine Holdings Inc’s (NYSE:SMHI) most recent earnings update (30 September 2017) and compare these latest figures against its performance over the past few years, as well as how the rest of the energy equipment and services industry performed. As an investor, I find it beneficial to assess SMHI’s trend over the short-to-medium term in order to gauge whether or not the company is able to meet its goals, and ultimately sustainably grow over time. View our latest analysis for SEACOR Marine Holdings
Commentary On SMHI’s Past Performance
I look at data from the most recent 12 months, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This technique allows me to analyze different companies on a similar basis, using new information. SEACOR Marine Holdings’s most recent twelve-month earnings -$123.4M, which, against the previous year’s figure, has become more negative. Given that these figures are somewhat short-term thinking, I have created an annualized five-year figure for SMHI’s net income, which stands at -$66.5M. This doesn’t seem to paint a better picture, since earnings seem to have gradually been getting more and more negative over time.
Additionally, we can assess SEACOR Marine Holdings’s loss by researching what has been happening in the industry along with within the company. Initially, I want to quickly look into the line items. Revenue growth over past few years has been negative at -39.20%. The key to profitability here is to make sure the company’s cost growth is well-controlled. Looking at growth from a sector-level, the US energy equipment and services industry has been relatively flat in terms of earnings growth . Thought this is a bit of a turnaround from a volatile drop of -19.34% in the last few years. This shows that any near-term the industry is enduring, it’s hitting SEACOR Marine Holdings harder than its peers.
What does this mean?
While past data is useful, it doesn’t tell the whole story. With companies that are currently loss-making, it is always difficult to predict what will occur going forward, and when. The most useful step is to examine company-specific issues SEACOR Marine Holdings may be facing and whether management guidance has regularly been met in the past. You should continue to research SEACOR Marine Holdings to get a more holistic view of the stock by looking at:
1. Financial Health: Is SMHI’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.