Analyzing FDG Electric Vehicles Limited’s (SEHK:729) 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 729’s recent performance announced on 30 September 2017 and compare these figures to its long-term trend and industry movements. Check out our latest analysis for FDG Electric Vehicles
Was 729’s recent earnings decline indicative of a tough track record?
For the most up-to-date info, I use data from the most recent 12 months, 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 enables me to examine various companies on a similar basis, using new information. For FDG Electric Vehicles, the latest earnings -HK$825.3M, which, relative to the previous year’s figure, has become more negative. Since these figures may be relatively nearsighted, I’ve estimated an annualized five-year figure for 729’s net income, which stands at -HK$718.7M. This doesn’t seem to paint a better picture, as earnings seem to have gradually been getting more and more negative over time.
Additionally, we can assess FDG Electric Vehicles’s loss by looking at what’s going on in the industry along with within the company. Initially, I want to briefly look into the line items. Revenue growth over the last few years has risen by 51.92%, signalling that FDG Electric Vehicles is in a high-growth period with expenses racing ahead high top-line growth rates. Viewing growth from a sector-level, the HK electrical industry has been growing its average earnings by double-digit 34.38% over the prior twelve months, and a flatter 1.69% over the past five. This suggests that whatever uplift the industry is benefiting from, FDG Electric Vehicles has not been able to gain as much as its average peer.
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 forecast what will happen in the future and when. The most useful step is to assess company-specific issues FDG Electric Vehicles may be facing and whether management guidance has regularly been met in the past. I recommend you continue to research FDG Electric Vehicles to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for 729’s future growth? Take a look at our free research report of analyst consensus for 729’s outlook.