Understanding how Best World International Limited (SGX:CGN) is performing as a company requires looking at more than just a years’ earnings. Today I will run you through a basic sense check to gain perspective on how Best World International is doing by comparing its latest earnings with its long-term trend as well as the performance of its personal products industry peers. See our latest analysis for Best World International
Were CGN’s earnings stronger than its past performances and the industry?
To account for any quarterly or half-yearly updates, I 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 analyze various companies on a more comparable basis, using new information. For Best World International, the latest twelve-month earnings is SGD46.2M, which compared to last year’s level, has risen by an impressive 77.74%. Given that these figures may be relatively nearsighted, I’ve computed an annualized five-year figure for CGN’s net income, which stands at SGD10.1M. This shows that, on average, Best World International has been able to consistently raise its net income over the past couple of years as well.
What’s the driver of this growth? Let’s take a look at if it is merely because of industry tailwinds, or if Best World International has seen some company-specific growth. In the past couple of years, Best World International grew its bottom line faster than revenue by successfully controlling its costs. This brought about a margin expansion and profitability over time. Eyeballing growth from a sector-level, the SG personal products industry has been growing, albeit, at a muted single-digit rate of 8.31% over the prior year, and a substantial 12.54% over the previous five years. This suggests that any tailwind the industry is gaining from, Best World International is capable of leveraging this to its advantage.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Companies that have performed well in the past, such as Best World International gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. You should continue to research Best World International to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for CGN’s future growth? Take a look at our free research report of analyst consensus for CGN’s outlook.