Want To Invest In Glorious Sun Enterprises Limited (HKG:393)? Here's How It Performed Lately
Measuring Glorious Sun Enterprises Limited's (SEHK:393) track record of past performance is a valuable exercise for investors. It allows us to understand whether or not the company has met or exceed expectations, which is an insightful signal for future performance. Today I will assess 393's recent performance announced on 31 December 2019 and compare these figures to its historical trend and industry movements.
Check out our latest analysis for Glorious Sun Enterprises
Could 393 beat the long-term trend and outperform its industry?
393's trailing twelve-month earnings (from 31 December 2019) of HK$110m has jumped 36% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of -5.3%, indicating the rate at which 393 is growing has accelerated. What's enabled this growth? Let's see whether it is merely a result of industry tailwinds, or if Glorious Sun Enterprises has seen some company-specific growth.
In terms of returns from investment, Glorious Sun Enterprises has fallen short of achieving a 20% return on equity (ROE), recording 4.5% instead. Furthermore, its return on assets (ROA) of 3.8% is below the HK Specialty Retail industry of 5.4%, indicating Glorious Sun Enterprises's are utilized less efficiently. However, its return on capital (ROC), which also accounts for Glorious Sun Enterprises’s debt level, has increased over the past 3 years from 2.5% to 3.5%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 47% to 0.6% over the past 5 years.
What does this mean?
Though Glorious Sun Enterprises's past data is helpful, it is only one aspect of my investment thesis. Recent positive growth doesn’t necessarily mean it’s onwards and upwards for the company. I suggest you continue to research Glorious Sun Enterprises to get a more holistic view of the stock by looking at:
Financial Health: Are 393’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.
Valuation: What is 393 worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether 393 is currently mispriced by the market.
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 2019. This may not be consistent with full year annual report figures.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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