Yahoo Finance Want To Invest In Bell Financial Group Limited (ASX:BFG)? Here’s How It Performed Lately
When Bell Financial Group Limited (ASX:BFG) announced its most recent earnings (30 June 2018), I did two things: looked at its past earnings track record, then look at what is happening in the industry. Understanding how Bell Financial Group performed requires a benchmark rather than trying to assess a standalone number at one point in time. Below is a quick commentary on how I see BFG has performed.
View our latest analysis for Bell Financial Group
Did BFG’s recent earnings growth beat the long-term trend and the industry?
BFG’s trailing twelve-month earnings (from 30 June 2018) of AU$25m has jumped 49% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 32%, indicating the rate at which BFG is growing has accelerated. What’s the driver of this growth? Let’s take a look at if it is only a result of an industry uplift, or if Bell Financial Group has seen some company-specific growth.
Over the past couple of years, Bell Financial Group grew its bottom line faster than revenue by successfully controlling its costs. This resulted in a margin expansion and profitability over time.
Eyeballing growth from a sector-level, the Australian capital markets industry has been growing its average earnings by double-digit 22% in the previous twelve months, and 20% over the previous five years. This growth is a median of profitable companies of 17 Capital Markets companies in AU including HUB24, Microequities Asset Management Group and Perpetual Equity Investment. This means that any tailwind the industry is benefiting from, Bell Financial Group is able to amplify this to its advantage.
In terms of returns from investment, Bell Financial Group has fallen short of achieving a 20% return on equity (ROE), recording 13% instead. Furthermore, its return on assets (ROA) of 2.9% is below the AU Capital Markets industry of 7.3%, indicating Bell Financial Group’s are utilized less efficiently. However, its return on capital (ROC), which also accounts for Bell Financial Group’s debt level, has increased over the past 3 years from 7.4% to 17%.
What does this mean?
Bell Financial Group’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. While Bell Financial Group has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. You should continue to research Bell Financial Group to get a more holistic view of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for BFG’s future growth? Take a look at our free research report of analyst consensus for BFG’s outlook.
Financial Health: Are BFG’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 30 June 2018. This may not be consistent with full year annual report figures.
To help readers see past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
