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Assessing BeijingWest Industries International Limited’s (SEHK:2339) performance as a company requires looking at more than just a years’ earnings data. Below, I will run you through a simple sense check to build perspective on how BeijingWest Industries International is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its auto components industry peers. View our latest analysis for BeijingWest Industries International
Despite a decline, did 2339 underperform the long-term trend and the industry?
I like to use 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 blend enables me to examine many different companies on a similar basis, using the latest information. For BeijingWest Industries International, its most recent trailing-twelve-month earnings is -HK$10.62M, which, against last year’s level, has turned from positive to negative. Since these values are fairly short-term thinking, I have calculated an annualized five-year value for BeijingWest Industries International’s net income, which stands at HK$72.94M.
We can further assess BeijingWest Industries International’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past five years BeijingWest Industries International’s top-line has risen by 41.90% on average, signalling that the company is in a high-growth period with expenses racing ahead revenues, leading to annual losses. Eyeballing growth from a sector-level, the HK auto components industry has been growing its average earnings by double-digit 17.61% over the past twelve months, and a less exciting 7.20% over the past half a decade. This suggests that any uplift the industry is profiting from, BeijingWest Industries International has not been able to realize the gains unlike its industry peers.
What does this mean?
BeijingWest Industries International’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. With companies that are currently loss-making, it is always difficult to forecast what will happen in the future and when. The most insightful step is to examine company-specific issues BeijingWest Industries International may be facing and whether management guidance has dependably been met in the past. I suggest you continue to research BeijingWest Industries International to get a better picture of the stock by looking at: