Yahoo Finance How Does BlueScope Steel Limited’s (ASX:BSL) Earnings Growth Stack Up Against Industry Performance?
Increase in profitability and industry-beating performance can be essential considerations in a stock for some investors. In this article, I will take a look at BlueScope Steel Limited’s (ASX:BSL) track record on a high level, to give you some insight into how the company has been performing against its historical trend and its industry peers. View our latest analysis for BlueScope Steel
Commentary On BSL’s Past Performance
I use the ‘latest twelve-month’ data, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This blend allows me to assess different stocks in a uniform manner using new information. For BlueScope Steel, its latest earnings (trailing twelve month) is AU$796.10M, which compared to the prior year’s figure, has climbed up by 14.04%. Since these values may be somewhat short-term thinking, I’ve calculated an annualized five-year value for BlueScope Steel’s net income, which stands at -AU$63.41M This means that, on average, BlueScope Steel has been able to steadily grow its net income over the last couple of years as well.
How has it been able to do this? Let’s take a look at whether it is only attributable to an industry uplift, or if BlueScope Steel has experienced some company-specific growth. Over the past few years, BlueScope Steel increased its bottom line faster than revenue by successfully controlling its costs. This resulted in a margin expansion and profitability over time. Scanning growth from a sector-level, the Australian metals and mining industry has been growing its average earnings by double-digit 18.18% in the previous twelve months, and a more muted 8.68% over the last five years. This means any tailwind the industry is enjoying, BlueScope Steel has not been able to gain as much as its industry peers.
What does this mean?
Though BlueScope Steel’s past data is helpful, it is only one aspect of my investment thesis. While BlueScope Steel has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. I recommend you continue to research BlueScope Steel to get a better picture of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for BSL’s future growth? Take a look at our free research report of analyst consensus for BSL’s outlook.
Financial Health: Is BSL’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.
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 December 2017. 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.
