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Assessing Winning Tower Group Holdings Limited’s (SEHK:8362) past track record of performance is a useful exercise for investors. It allows us to understand whether the company has met or exceed expectations, which is a great indicator for future performance. Below, I assess 8362’s latest performance announced on 31 March 2018 and evaluate these figures to its historical trend and industry movements. View our latest analysis for Winning Tower Group Holdings
Could 8362 beat the long-term trend and outperform its industry?
I look at 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 allows me to examine various companies on a similar basis, using new information. For Winning Tower Group Holdings, its latest trailing-twelve-month earnings is -HK$2.49M, which, against last year’s level, has become less negative. Since these values may be somewhat myopic, I’ve estimated an annualized five-year figure for 8362’s net income, which stands at -HK$3.24M. This means that, although net income is negative, it has become less negative over the years.
We can further examine Winning Tower Group Holdings’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past five years Winning Tower Group Holdings’s top-line has increased by a mere 6.74%, on average. The company’s inability to breakeven has been aided by the relatively flat top-line in the past. Viewing growth from a sector-level, the HK consumer retailing industry has been growing, albeit, at a unexciting single-digit rate of 4.60% in the past twelve months, . This is a change from a volatile drop of -4.82% in the previous couple of years. This means that although Winning Tower Group Holdings is presently running a loss, whatever recent headwind the industry is facing, Winning Tower Group Holdings is less exposed compared to its peers.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Companies that incur net loss is always hard to envisage what will happen in the future and when. The most useful step is to assess company-specific issues Winning Tower Group Holdings may be facing and whether management guidance has consistently been met in the past. You should continue to research Winning Tower Group Holdings to get a more holistic view of the stock by looking at:
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Financial Health: Is 8362’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.
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Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
NB: Figures in this article are calculated using data from the trailing twelve months from 31 March 2018. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.